Construction law is an area in which legal errors are rarely seen immediately, but are almost always paid dearly. The BSLC team has over 24 years of experience in judicial and extrajudicial decisions of legal cases in the field of construction law. Clients most often seek help when the project is already delayed, stopped or burdened with risk — in the event of problems with a building permit, contracts with a builder or refusal to put into operation
Civil and commercial relations in construction are among the most complex and heavily regulated areas of Bulgarian law, as they simultaneously encompass spatial planning, investment design, and the construction process itself, which pursuant to Art. 1(2) of the Spatial Development Act (SDA) regulate not only private-law relations but also significant public interests. Every construction project – whether involving a single-family residential building, a holiday property, a residential complex, a commercial facility, or infrastructure development – passes through strictly formalised legal and administrative stages, where legal omissions frequently result in refusals, prolonged delays, sanctions, or the complete impossibility of implementing the investment.
Construction law begins well before the first excavation, with spatial planning and the legal regime of the territory, as construction is permissible only where it is envisaged by an effective detailed development plan and complies with the designated use of the land plot pursuant to Art. 12(2) and Art. 8 SDA. At this preliminary stage, some of the most common practical issues arise, including unregulated land plots, inappropriate land designation, lack of frontage to a public street, restrictive development parameters, existing servitudes, or conflicts with applicable planning rules and regulations. Timely legal intervention at this stage has a strictly preventive character and often avoids substantial future financial losses and the blocking of projects.
The next key phase is investment design and the issuance of a building permit, which pursuant to Art. 148(1) SDA constitutes an individual administrative act and a mandatory prerequisite for the lawful commencement of construction. It is precisely at this stage that disputes with municipal authorities, explicit or tacit refusals, coordination issues, design visas, and challenges of administrative acts most frequently arise. A lack of familiarity with statutory deadlines, the competence of authorities, and available legal remedies often leads to projects being stalled for years.
During the construction phase itself, construction law directly intersects with contract and property law, as the relations between the investor, contractor, designer, construction supervisor, and subcontractors are governed by complex contractual frameworks. Delays, defective performance, deviations from the approved investment project, or violations of construction documentation may result in suspension of construction, administrative sanctions, or refusal to commission the building, which under Art. 177 SDA is a mandatory condition for the lawful use of the completed construction.
In this highly complex legal environment, BSLC provides comprehensive, practical, and strategically focused legal assistance in the field of construction law in Burgas, Varna, Plovdiv, Sofia, Yambol, and throughout Bulgaria. Our services cover all stages of the investment and construction process, including in particular:
Drafting of agreements for the establishment and transfer of building rights (superficies) as a limited real right under Art. 63 and Art. 67 of the Ownership Act, including arrangements against monetary or in-kind consideration
Drafting of group construction agreements between co-owners and investors for joint development pursuant to Art. 183 SDA
Drafting and legal review of construction contracts, including “turnkey” construction agreements, under Art. 258–266 of the Obligations and Contracts Act
Drafting of agreements for vertical and horizontal extensions, regulating ownership of newly constructed units under Art. 38 and Art. 40 of the Ownership Act
Drafting and legal analysis of off-plan sale agreements (“green building” sales) and preliminary agreements under Art. 19 of the Obligations and Contracts Act
Legal analysis and due diligence of construction and investment projects, including ownership, encumbrances, planning regimes, and permits
Legal assistance in administrative proceedings for the issuance of building permits under Art. 148(1) SDA, as well as representation in appeals against refusals
Legal support in procedures for amendment of detailed development plans under Art. 134 SDA and in proceedings for change of land designation
Procedural representation in appeals against orders for suspension or demolition of construction under Art. 225 SDA
Litigation relating to defective or delayed construction, including claims under Art. 79, Art. 92, and Art. 265 of the Obligations and Contracts Act
Legal assistance in commissioning procedures and issuance of use permits (Act 16) pursuant to Art. 177 SDA
Ongoing and comprehensive legal servicing of construction investors, covering the entire process from the initial investment concept to final commissioning
We operate both preventively, with the aim of minimising legal risks and ensuring the lawful development of construction projects, and reactively, where disputes have already arisen with authorities, neighbouring property owners, or other participants in the construction process, including through effective administrative and judicial proceedings.
Which cities and regions in Bulgaria do we support?
The lawyers and legal consultants working under the BSLC brand provide legal assistance across civil, corporate, real estate, construction, immigration, tax, insurance and related matters, including property transactions and disputes, contract matters, and representation before courts and administrative authorities.
Support can be provided both in person and remotely.
Our main locations are Sofia, Varna and Burgas, and we also work with clients from:
all regions of Bulgaria
EU countries, Switzerland, the UK and the EEA
Russia, Ukraine, Belarus, Kazakhstan and CIS countries
other jurisdictions with legal or business interests in Bulgaria
Do you need legal advice from a capable Bulgarian solicitor?
What contracts are used in construction law in Bulgaria?
In practice, construction is almost never settled by a single contract. The usual model represents complex of contractual and property relations, by which risks are distributed between the contracting authority, the builder or the investor, the designers, the construction supervision and sometimes third parties. The key dividing line is whether the owner of the property provides only the execution of construction and installation works for a price, or provides and property right in rem— building rights, ideal parts of the land or future independent sites. In the second case, the legal structure, the form of transactions and the necessary collateral are significantly complicated.
What are the construction contract for compensation and the building right contract and what risks do they entail?
The construction contract for compensation and the building right contract are two closely related, but legally different instruments that are often used jointly in investment construction. What they have in common is that in both models, the owner of the terrain provides tangible or economic value, and the opposing side undertakes to build construction. The difference is in the legal nature of what is provided and the moment at which the risk is transferred.
The contract for construction against compensation is essentially combined legal structure, in which the binding relationship under the contract of manufacture (Art. 258 et seq. ZZD) are combined with dispositions in rem. The owner of the property does not pay for the construction with money, but by granting the right to build, ideal parts of the land or future independent objects, in return the investor undertakes to build the building and provide the owner with the agreed compensation in objects and/or monetary amount. It is because of this dual nature that this contract is among the most risky for the owner if it is not structured carefully.
The building right contract, regulated as a limited right in rem under art. 63 ZC, is the legal mechanism through which construction on foreign property is allowed. The owner of the land cedes to another person the right to build a building on his property and become the owner of the structure. This contract is necessarily concluded by a notarial deed due to the requirement of Art. 18 ZZD and is subject to registration because it creates and transfers a right in rem. In practice, the building rightcontract is the “entrance” of the investor to the project and the moment from which his real tangible participation begins.
The risks in these contracts arise mainly from time and conditionswhere the right in rem is granted. If the right to a building is established without phasing, without guarantees and without a clear commitment to real execution, the owner of the property effectively finances the project with his land, without being sure that he will receive the agreed compensation. In case of default, its protection often requires lengthy court proceedings, including a claim for insolvency under Art. 87 ZDA, which is particularly problematic in the case of property law already established and registered.
What are the rights and obligations of each of the parties?
The rights and obligations of the parties should be considered symmetrically, but with a clear awareness of the different risks. The owner of the property has the obligation to secure a legally valid land and to establish the agreed property right upon the occurrence of the agreed conditions, and his main right is to receive precisely defined compensation — individualized objects, degree of completion, terms and guarantees. The investor, in turn, has the right to build and dispose of the right to build within the framework of the law, but bears the obligation to build the construction legally, on time and in accordance with the approved projects, as well as to hand over the agreed compensation.
How does a bad contract “collapse” a good construction project?
In construction, even a completely USUT-permissible and technically well-designed object may turn out to be unfeasible or economically disastrous due to improperly structured contractual relations. The reason is that the construction process is not only managed by administrative acts and construction papers, but to a decisive extent by the contracts between the participants — investor, builder, designer, construction supervisor and owners of the property. When these contracts are incomplete, template or unilaterally advantageous, the risk is not abstract but entirely real.
One of the most common mistakes is unclear distribution of responsibilities. In contracts in which it is not clear who is responsible for delays, defects, deviations from the project or administrative sanctions, when a problem arises, each party shifts the blame to another. As a result, construction is blocked, and the principal or owner of the property is left without a real tool to enforce or seek effective compensation. This contradicts the very logic of the contract of elaboration under Art. 258 ZZDA, in which the contractor is responsible for the final result.
There is a significant risk and improperly arranged deadlines and penalties. Often in practice, contracts are found with “indicative” terms, without clear consequences in case of delay, or with penalties that practically do not stimulate performance. In investment projects, any delay leads to additional costs, missed benefits and financing problems, and the lack of effective contractual penalties makes these losses difficult to compensate.
It is particularly disruptive to the project. poorly arranged mechanism in construction against compensationwhen the owner grants a right in rem, but the contract does not contain sufficient guarantees of performance. If the right to build or ideal parts are transferred without staging, without collateral and without clearly defined terms of spoilage, the owner loses his strongest instrument of protection right from the start. In such a situation, even serious default on the part of the investor often leads to long and expensive litigation, instead of a quick and effective solution.
A bad contract often “collapses” the project and through lack of link between contractual obligations and the administrative regime under the MET. Contracts that do not take into account the requirements for construction papers, supervision, acts and commissioning create a legal vacuum — formally the construction can be carried out, but in practice it is impossible for legal completion and use.
After all, the problem is not in the construction itself, but in the fact that the contract does not manage the risk. A well-drafted contract does not guarantee the absence of problems, but provides mechanisms for solving them. A bad contract does the opposite — it turns any problem that arises into a threat to the entire project, no matter how “good” it was originally on paper.
If I have a property and I am offered construction for compensation what should I do?
If you own a property and are offered construction for compensation, the right approach starts with legal and structural analysis by a good lawyer in construction law, with which you can contact from BSLC, and not with the financial parameters of the offer. First of all, it must be checked whether the property is suitable for construction according to the current detailed development plan and whether the parameters of the promised construction are realistic from a legal point of view. Secondly, contracts should be structured in such a way that the establishment or transfer of a building right is linked to stages of implementation and adequate safeguards, rather than being carried out entirely at the outset. Only finally does it come to the notarization of real estate transactions, when the contractual framework already protects the interest of the owner.
Many owners of regulated land properties underestimate the risk that the investor or construction firm that offers construction for compensation does not have the necessary financial, organizational or technical capacity to bring the project to completion. The lack of pre-lime verification of the reliability and real experience of the builder often leads to situations where the property remains partially built-up, without the possibility of legal completion or commissioning, which in practice makes it unusable and significantly depreciated.
With proper structuring, a construction contract for compensation and a building right contract can be an effective tool for realizing the value of the property. However, with a formal or hasty approach, they become a source of heavy and long-lasting property and construction disputes, in which the risk to the owner is disproportionately higher.
What makes a constucted building legal in Bulgaria?
The legality of a construction is not determined by whether it is “physically built”, but by whether all the legal prerequisites provided for in the Law on Spatial Planning have been fulfilled cumulatively. According to Art. 148, para. 1 ZET constructions may be carried out only if they are authorized with a valid building permit issued on the basis of an approved investment project and in accordance with the current detailed development plan. The absence of even one of these elements puts the construction at risk of being classified as illegal.
Legality begins from the structural basis of the property, since building is permissible only if it is provided for by the entered into force of the Public Works Plan and in compliance with the purpose of the territory and the property according to Art. 8 and Art. 12, para. 2 BLANKS. In practice, this stage is often underestimated and proceeds to design or even construction on properties with an unsettled planning regime, which subsequently leads to refusals, orders to stop or the inability to put the construction into operation. It is here that the legal analysis is decisive, since not every property that “looks suitable” is legally fit for development.
The next key element is the building permit, which is an individual administrative act and the main guarantee of the legality of the construction. A permit issued in the event of material infringements — for example, in the absence of proper coordination, in contradiction with the PPA or in case of non-compliance with the regulatory requirements — is subject to revocation, which directly affects the validity of the entire construction. In these cases, even an actually constructed object may turn out to be legally non-existent from the point of view of structural law.
Legal construction also requires strict adherence to the approved investment project during implementation, since significant deviations from it constitute a violation of Art. 154 PPE and may result in penalties, suspension of construction or refusal of commissioning. It is a common mistake to perceive “minor changes” as minor, without taking into account that their legal assessment is made on criteria other than technical expediency.
What is a building permit and when can it be refused or revoked?
A building permit is an individual administrative act, without which the carrying out of construction is inadmissible, except in the exceptions expressly provided by law. According to Art. 148, para. 1 ZUT constructions may be carried out only if they are authorized by a building permit issued by the competent administrative authority on the basis of an approved investment project. This means that the building permit is not a formality, but the legal “basis” on which all subsequent construction steps - from the opening of the construction site to the commissioning of the site.
Refusal to issue a building permit is available when the legal prerequisites provided for in the ZUT and the by-laws are not met. The most common grounds are non-compliance of the project with the current detailed development plan, lack of necessary reconciliations, non-compliance with the structural indicators, as well as incompleteness or contradiction in the investment documentation. In practice, there are also frequent cases of so-called silent refusal, in which the administration does not give a ruling within the statutory period, which is also subject to legal protection in the judicial order.
It is especially important to consider that even an already issued building permit is not absolutely protected. It can be revoked by administrative or judicial order if it is found that it was issued in the event of significant violations of the law — for example, in the event of a conflict with the SPU, in the absence of competence of the authority or in case of non-compliance with a mandatory procedure. The revocation of a building permit has severe consequences, since it calls into question the legality of construction work already carried out and can lead to the suspension of construction or the refusal of commissioning.
In practice, the biggest risk for investors and owners is to treat a building permit as the “endpoint” of legal issues, rather than an intermediate stage that is subject to scrutiny and challenge. That is why legal protection at this stage is crucial — both in the case of refusal or tacit refusal to issue a permit, and when it is necessary to protect an already issued permit against complaints from neighbours or other interested parties. Timely intervention by a lawyer is often the factor that determines whether the project will continue or be blocked for a long period.
What are the most common legal issues during construction and how are they solved?
During construction, the most serious and risky legal situations arise, since at this stage significant investments have already been made, and any stop or violation has a direct financial impact. One of the most common problems is the suspension of construction by the inspection bodies when violations of the building documents or the requirements of the ZET are detected. According to Art. 224 and Art. 225 ZET construction may be suspended or qualified as illegal in the absence of a valid building permit, in case of significant deviations from the approved investment project or in case of non-compliance with the mandatory technical and structural rules.
A particularly common problem is deviations from the approved design during implementation. In practice, they are often perceived as “minor changes”, but their legal assessment is strict — if the deviation falls within the hypotheses of Art. 154 ZET, it requires due approval, and in the absence of such approval may lead to sanctions, suspension of construction or refusal of commissioning. It is here that conflicts arise between an investor, a builder and a designer about who is responsible for the violation committed.
Another significant source of problems is contractual relations between the participants in the construction process. Delay in deadlines, poor-quality execution, use of materials that do not correspond to the project, or lack of proper construction supervision lead to disputes about penalties, compensation and warranty liability. Although these relations are negotiated, the consequences often also have an administrative dimension when the infringements affect the legality of the construction.
Last but not least, during construction, disputes also arise with neighbors and third parties who can appeal the building permit, report violations or seek protection of their rights. These actions often lead to checks, delays and additional administrative pressure that requires a coordinated legal response.
Solving problems during construction requires quick and precise legal intervention, as delay often aggravates the consequences. The approach includes the analysis of construction papers, assessment of the legality of the actions performed, protection against unlawful acts and, if necessary, taking legal action. The goal is not just a formal “challenge”, but to preserve the possibility that the construction can be completed and put into operation without the accumulation of additional legal and financial risks.
Below we have collected answers to some of the most frequently asked questions from our clients on the subject and we hope that they will help you achieve a more complete understanding of the matter under consideration.
Can I build if the property does not have a valid detailed development plan (DEP)?
As a rule, construction is permissible only if there is a valid PUP for the property, which determines the purpose, manner and parameters of construction, according to Art. 12, para. 2 BLANKS. In the absence of a PUP, construction cannot be started legally, except in the exceptions expressly provided by law. In practice, the first and mandatory step in any construction project is an inspection of the structural basis of the property, since without it all subsequent actions are legally risky.
What does “illegal construction” mean and is it always subject to elimination?
Illegal is the construction that is carried out without the required building documents, in case of significant deviations from the approved project or in contravention of the structural rules, within the meaning of Art. 225 RUBLES. However, not every illegal construction is automatically subject to elimination, since the law also knows the category of “tolerable construction” under which certain conditions are met. Legal qualification is crucial, because it depends on it whether the object can be preserved or will be subject to a removal order.
How should I react to an inspection by the Directorate National Construction Control (DNCC) or the municipal administration in Bulgaria?
The inspection itself does not imply a violation, but the reaction of the contracting authority or owner is essential. Clarity on the basis of the inspection should be required, construction papers should be provided and no hasty confessions or actions that could aggravate the situation should be made. In these situations, timely legal assistance is key, as many subsequent acts are subject to challenge at short notice.
Who is liable for defects — the builder or the investor?
Liability for defects depends on the specific contractual relationship and the role of each party in the construction process. As a rule, the builder is responsible for the quality of the execution, and the investor - for the organization and legal implementation of the project. In practice, disputes often arise about the distribution of responsibility, which is why clearly formulated contractual clauses and proof of the cause of the defect are decisive.
Can a neighbor stop my construction and under what conditions?
Neighbors have the right to defend their legitimate interests and can appeal a building permit if they are interested persons within the meaning of the ZUT. However, this does not mean that any signal or complaint automatically stops construction. Suspension occurs only in the presence of a legal basis and a competent administrative or judicial act, therefore it is important to distinguish between a formal complaint and a real legal obstacle.
What are the deadlines in Bulgarian construction law and why are they critical?
Construction law is highly formalized and bound by deadlines — for appealing administrative acts, for starting and completing construction, for commissioning. Missing a time limit often leads to the loss of the right of protection or to the automatic occurrence of adverse consequences. That is why managing deadlines is as important as the construction itself.
What to do in case of refusal of the Bulgarian administration to coordinate a project or issue a construction permit?
Refusal does not mean the end of the procedure, since most administrative acts and tacit refusals (inactions of the administration) are subject to appeal in court. It is crucial to analyze the reasons for refusal, the competence of the authority and compliance with procedural rules. In many cases, refusals turn out to be illegal and can be canceled if timely and correct response is made.
In which cases is it mandatory to contact a construction lawyer in Bulgaria?
The intervention of a lawyer is practically necessary whenever property rights are affected, significant investments or when a conflict arises with the administration, neighbors or participants in the construction. The sooner legal aid is sought, the greater the possibility of managing the risk preventively, rather than seeking a solution after adverse consequences have already occurred.
.svg)
.svg)
.svg)
