Delayed Property Construction in Bulgaria: What Can Buyers Do?

1. Identify the deadline that was actually agreed

“Completion” may mean structural completion, completion of finishing works, an application for commissioning, authorisation for use, the final notarial transfer or delivery of the keys. These are different events. Put the preliminary purchase contract, construction agreement, specifications, payment schedule and every amendment side by side.

Check whether the date is fixed or runs from a permit or another event. Record any grace period, extension mechanism and obligation to notify the buyer. A marketing estimate is useful evidence, but it does not necessarily replace the signed completion clause. Nor does an administrative delay automatically excuse every contractual obligation.

The document commonly called “Act 16” is not the same for every building category. Establish which commissioning document the building requires and whether the contract promises to obtain it or merely to apply for it.

2. Establish who owes you performance

The landowner, seller, project developer, building contractor and broker may be different companies. Your contractual claim normally starts with the party that undertook the relevant obligation. A construction contractor is not automatically liable to an apartment buyer merely because it worked on the project.

Also check whether you already own the property or a right of construction, or hold only a preliminary contract. That distinction affects the available remedies, security and insolvency exposure. Check the current company and property-register position alongside the contract.

3. Preserve a usable record

• Keep the signed contracts, annexes, technical specification and payment evidence.
• Prepare a chronology of each milestone, promised extension and missed date.
• Retain original emails and attachments, formal notices and proof of receipt.
• Obtain lawful, dated photographs and an independent technical assessment where progress is disputed.
• Record additional costs, such as rent, with the documents showing why they arose.

A specialist should distinguish physical progress from legal readiness for occupation. Keys, electricity or an invitation to inspect do not themselves establish that all requirements for lawful use have been met.

4. Compare completion, compensation and termination

Under Articles 79–82 of the Bulgarian Obligations and Contracts Act, performance and compensation depend on the obligation, the cause of non-performance and the recoverable loss. Contractual penalties under Article 92 require their own assessment: the triggering event, calculation, cap and validity matter. Do not simply add a penalty to every alleged loss; overlap and the contractual wording must be considered.

Termination for breach under Article 87 commonly requires an appropriate additional period and a warning that the contract will be treated as terminated if performance is not supplied. The warning must be written where the contract is written. Exceptions exist, including certain cases where delayed performance has become useless or timely performance was essential. Minor non-performance may not justify termination.

A preliminary purchase agreement and a contract that already transfers or creates rights in immovable property must be distinguished. Article 87(3) requires judicial termination of the latter category. Where there is a construction contract, Article 262(2) may also be relevant if it becomes apparent that the contractor cannot perform on time or properly. The correct route depends on the actual contractual relationship.

5. Treat an extension as a new legal commitment

An extension can be commercially sensible if it gives a realistic completion plan and preserves appropriate protection. Review the new date, measurable milestones, reporting duties, payment triggers, outstanding penalties, security and the consequence of another failure.

Illustrative example: a developer offers a three-month extension but the annex also says the buyer has no claims for earlier delay. Signing may settle more than the timetable. The practical question is what the buyer receives in exchange for that release and whether the project can actually be completed.

If repayment is negotiated, specify the amount, due dates, any security, the effect of a missed instalment and when releases take effect. A repayment promise is not the same as available funds.

6. Do not create a payment default of your own

A buyer should not assume that any construction delay permits all future payments to stop. Check whether the particular instalment is due, whether its milestone has occurred and whether a defence of non-performance is available. Conversely, an early demand for a final instalment should be compared with the agreed payment conditions before money is transferred.

Keep communications factual. An informal message saying “I cancel everything” can complicate a later demand for completion. Have the remedy and notice assessed before committing to one legal position.

7. Check recovery prospects and time limits

Investigate mortgages, attachments, the seller’s financial position and any insolvency proceedings. A judgment for repayment does not guarantee recovery. Depending on the claim and evidence, court-ordered interim security may need assessment before assets disappear.

Different claims can have different limitation rules. A demand or ongoing negotiation should not be assumed to stop time running. For an initial review, provide the amount paid, the missed milestone, the latest correspondence and whether your priority is completion or repayment.

Legal sources and scope

• Obligations and Contracts Act
• Registry Agency legislation: Civil Procedure Code and Spatial Development Act

Official sources are in Bulgarian. The English and Russian explanations are not official translations of the legislation.