Parliament's budget committee has backed, on first reading, changes to the law on public offering of securities that will let companies trade shares carrying more than one vote. The cabinet put forward the bill, and the committee voted 18 in favour, none against and one abstention.

The bill brings Bulgaria in line with an EU directive on companies with multiple-vote shares. Deputy finance minister Metodi Metodiev presented it to the committee.

He said the new rules keep control over how such companies are run unchanged and will make it easier for innovative start-ups in Bulgaria.

To protect minority shareholders, the bill sets a double threshold for qualified-majority votes, Metodiev explained. Decisions that need a qualified majority under the commercial code will have to get that majority both among the votes cast and among the shares represented at the meeting.

The extra voting rights disappear in two cases. First, if the general meeting decides the company should go public so its shares can trade on a regulated market. Second, if the investment firm or market operator running the multilateral trading facility delists the company.

Companies will have to disclose their ownership structure on time. Metodiev said this is meant to keep investors' trust and help them make informed decisions.

Any joint-stock company with this kind of share structure, whose shares are or will be admitted to trading on a multilateral trading facility — including an SME growth market — will have to disclose who owns it. It will also have to spell out any limits on transferring shares or on voting rights. The company must name anyone holding multiple-vote shares that add up to more than 5% of the total voting rights, if it knows who that is. The same goes for anyone entitled to vote on those shareholders' behalf.

This information will go into the prospectus or the document used to admit the shares to trading on a multilateral trading facility. It will also appear in the annual financial report if it wasn't published before or has changed since it was last published.

During the debate, lawmakers said the wording on how the Financial Supervision Commission shares information that counts as a professional secret needs to be sharpened before the second reading.