Upon planning business in Albania you need to choose from two options: create a locally incorporated company like a partnership, limited liability or joint venture or open a branch/office inside the country.
Sole Proprietorship
This is the easiest way to do business in Albania. Simply register as a person or business by filling in and submitting an application with information on the business or person, address, activity, and signature. Alongside your application, you need an ID and both documents go into the National Registration Center of the company’s area. Additionally, you register with the tax office.
General Partnership
In such a case, the partners of the business are subject to all obligations of the business. There are no requirements on minimum capital in order to set up a partnership. In a partnership in Albania, all partners have the right to involve third parties without notice and are all administrators by default.
To dissolve a partnership, either a partner passes away, you declare bankruptcy, lose your business license or declare one of your partners to be incompetent. Also, every year you need to report the financial situation to the corresponding authorities.
Limited partnership
In a limited partnership are involved both general and limited partners. The latter are made responsible only in accordance with their investment, whereas genera partners have full liability.
A limited partner has the right to access financial reports twice a year at least, but they have no say in the administration of the entity. When setting up such a partnership, it needs to be clearly stated the amount and value of investment of each partner. As opposed to general partnerships, here the death of a partner does not cause termination of the partnership.
Limited Liability Company
An Sh.p.k is a frequent presence in the Albanian landscape, especially when foreign investors turn here because it grants flexibility.
The initial capital needs a minimum of ALL 100 – 0.99 USD or 0.72 EUR. The company can have one or many partners, either legal entities or individuals who are liable only in the amount of their investment. An investment can be regarded as a sum of money or any asset of value, but not services. Managing such a company falls under the responsibility of the shareholders and is appointed to directors who cannot have any interest in the company.
Yearly financial reports need to be filed and income that exceeds a certain amount requires the company to employ public accountants.
You can transform such a company into a partnership or joint stock companies, but the decision can be made only with ¾ of the shareholders agreeing on it.
Joint Stock Companies
Partners in Joint Stock Companies take responsibility to the degree of their initial contribution, be it money or assets. Such businesses can be private, with an initial capital of at least 14 500 EUR, or public with a base capital of 72 500 EUR. The public kind is subject to their stocks being made available on the stock market.
Branch or Office
Companies from outside Albania can register a branch or a representative office through a simple procedure. You need to submit the required documents to the NRC: the decision of branch opening from the main company, proof of a direct connection between the branch and the main company, proof of registration of the company and a legalized foundation chart. A decision should be made in just 1 day. Then, registration with the Tax office is required where you’ll receive your ID number.
Subsidiary
There are diverse types of subsidiaries in Albania and they all share one trait: shareholders and the capital of the main company have limited liability. The company chooses to associate with the subsidiary and is in charge of the management. The pros of opening a subsidiary in Albania are the low tax that guarantees the profits will not be double-taxed.
