Company Registration

Company Registration

Foreigners enjoy the right to engage in economic activities in Albania without the need to request permission or authorization. The Albanian legislation provides that in all cases and at all times, foreign investments shall receive fair and equitable treatment and shall enjoy full protection and security.

Before engaging in economic activity a company should register with the District Court. The registration process includes legal formalities such as a court decision and registration with the Albanian Trade Register and Local Fiscal Administration. Request for registration from the court must be made within one month prior to any business activity. The court responds to registration requests within a month.

The Albanian Government has committed to improving the business climate through easing registration procedures and making the process more efficient. Such changes will include reduction of registration time from 30 to 8 days and digitalization of the Commercial Register. Recently, the costs for registration of foreign business were reduced to the same level as for local business.

Law no.7638, of 19.11.1992 “On commercial companies” acknowledges 4 forms of commercial companies: Limited Liability Companies (LLC), Anonymous Companies (AC); Collective Companies; and Commandite Companies. Commercial companies are considered legal persons and are registered as such with the Court. Foreign companies in Albania most frequently register as the first two: Limited Liability Companies or Anonymous Companies.

• Limited Liability Companies (LLC) LLCs are companies founded by one or several partners, which face company losses up to the limit of their contribution value in founding capital. Based on legislation, the minimum value of founding capital for this type of company is 100 thousand ALL. The registration request is submitted by its administrators, accompanied with names, surnames, dates and places of birth of administrators and the statute dispositions specifying their competences. The deposit certificate of funds resulting from settlement of founding capital must be attached to these documents.

• Anonymous companies (AC) or Joint Stock Companies Anonymous companies are companies whose capital is divided in shares and are established by partners facing losses up to the limit of the value of their contribution. These companies are divided into: • Anonymous companies with public offer. The minimum value of founding capital must be 10 million ALL. • Anonymous companies without public offer. The minimum value of founding capital must be 2 million ALL. The registration request for an anonymous company is submitted by all members of the board of directors.

In order to register with the commercial register, the company must provide the following documents: • The statute • Signatures and appointment act for the administrators of the board of directors • A list including the names, surnames, dates and places of birth of the supervising council members • In the case of foreign contributions to Albania, the report of contributions or, if necessary, the partners’ decision to ask for assistance from an expert on contributions.

• A certificate of deposit of funds resulting from signature of shares for monetary contributions.

Fact Sheet No.6

Last updated: February 2007

Company Registration

Other forms of operating in Albania include opening representative offices and branches of foreign legal entities. These are regulated by the law no.7632 of 1992 “On Provisions of the First Part of Commercial Code”.

• Representative Offices Foreign companies may open their representative offices in Albania to carry out non-income generating and non-commercial activities. Representative offices cannot conduct commercial activities in Albania. Foreign investors can still use representative offices if their presence in Albania only consists of promoting the activity of one of their foreign group companies in Albania.

• Branches of Foreign Legal Entities Branches of foreign legal entities can be registered to conduct commercial operations in Albania. A branch is subject to the corporate profit tax in the same manner as other Albanian companies but there is currently no branch remittance tax in Albania. Foreign investors rarely use branches unless they plan on a temporary presence in Albania, or if investors decide not to legally separate the Albanian entity from the parent company.

Steps to Take for Registration The first step to company registration is presenting the necessary documents to the Office of Company Registration in the District Court. The list of documents is shown in the table below.

After the court approves the request to register the legal person, the decision is registered in the commercial register. The tariff for registration in the commercial register is 1,200.00 ALL, including the stamp tax.

Documents required for registration according to the type of company

Fact Sheet No.6

Last updated: February 2007

Company Registration

The second step is registration at the tax office to obtain the tax certificate and the NITP (Number of Identification as Taxable Person). Request for a tax certificate is submitted to the tax department of the district where the person’s central office is located. The tax office will process all requests for tax certificates within 5 days from receiving the requests.

The documentation submitted by legal persons to the tax offices includes: • Act of establishment • Statute of company • Decision of the District Court for registration as legal person • Statement from social assistance office • Contract with employment office • Statement from Social Insurances Office • Registration with the Chamber of Commerce and Industry • Proof of payment for local taxes (advertisement, buildings, cleaning, rented land, property) • Number of bank account and bank statement • Hygienic and sanitary permission (if necessary) • Registration cashbox • Registration with the office for control of measurement devices (if necessary) In most cases the documents must be in Albanian language and notarized by a public notary.

The Costs of Establishment The table below describes the costs of establishing the business:

Fact Sheet No.6

Last updated: February 2007

Company Registration

Fact Sheet No.6

Last updated: February 2007