Albania at a Glance

Country Presentation

General Information

The most common form of entity chosen by foreign investors is a limited liability company (SH.P.K). There are several reasons why national and foreign investors choose the limited liability company over other forms, such as the lower principal capital requirements and the fact that the managing body of the company (i.e. the administrator(s)) is easier to form and simplifies the formalities of carrying out everyday business.

 

Limited liability companies

Pursuant to the Law on Commercial Companies, a limited liability company may be founded by one or more founders that shall be financially liable up to the amount of their contributions to the principal capital The minimum cash contribution required that must be paid as principal capital is 100,000 Lek.

Joint stock companies

The Law on Commercial Companies provides that a joint stock company is a company whose capital is divided into stocks and which is established by partners who are held responsible for losses only up to the limit of their contribution to the initial capital. The company can be established by and can have one or many partners. According to the article, its name must contain the designation “joint stock company” or “ShA” (shoqeri anonime) (SA).
Joint stock companies may, in theory, be set up as a joint stock company without a public offering (closely-held) or with a public offering (public). Companies with a public offering are those whose stocks are officially registered on the stock market (which is not currently fully operational in Albania). All other public companies are companies without public offerings. The minimum principal capital of a joint stock company must be of 2,000,000 Lek. In a public offer joint stock company, it is 10,000,000 Lek.

Foundation of a limited liability company and joint stock company

The documents necessary for establishing either a limited liability company or a joint stock company are the founding act and the articles of association.
The founding act must contain, inter alia, particulars regarding the (i) legal form of the company under formation; (ii) company’s duration (if determined); (iii) name of the company; (iv) name(s) of founder(s); (v) the company’s registered office; and (vi) the object of the company’s activity.
The articles of association must contain particulars regarding, inter alia, (i) par value, kind and class of issued shares; (ii) procedure for appointing members of the company’s bodies and description of the scope of their authority; (iii) procedure for making amendments to the articles of association, related to the transfer of shares, etc; and, if the company is incorporated for a specific term, (iv) the technique by which the company will be terminated upon the expiry of such term.

Registration of a limited liability company and joint stock company

Commercial companies (i.e. limited liability companies and joint stock companies) come into existence and thereby become legal entities upon their registration with the Commercial Registry. The request for registration with the Commercial Registry needs to be submitted to the competent court after it is signed by the company’s administrator(s). The request for registration must be accompanied, inter alia, by the following documents:
(a) Founding act (as certified by a notary);
(b) Articles of association (as certified by a notary);
(c) A report by a certified auditor regarding the value of the contributions in kind (if applicable);
(d)Certificate from an Albanian bank, confirming that the funds necessary for payment of the nominal share capital have been duly deposited with a bank within the banking system of the Republic of Albania;
The registration with the Commercial Registry is approved by the decision of a sole judge. Registration procedures are considered “urgent”, and thus the registration procedure is typically completed within thirty (30) - days.

 

Post-founding activities

After the registration with the commercial registry, a limited liability company should apply with the following authorities:

 

(a) the competent tax office (and follow the procedure to obtain the relevant tax certificates);
(b) the social insurance office (concerning obligatory social insurance contributions);
(c) the labour office (to declare the number of employees hired);
(d) the relevant ministry (for the purpose of obtaining an operational license when required);
(e)other administrative bodies authorised to issue other types of licenses/permissions (e.g. hygienic/sanitary, fire protection, etc.).

We hope that this has been informative and we would like to use have the opportunity to offer our legal services for the establishment of the company and its registration with the Commercial Register.

For more information please contact:

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