Foreign Company Setup in Albania

Establishing a Foreign Company Presence in Albania

International companies looking to expand into Albania have several options for establishing a legal presence. Whether you want to open a branch office, register a wholly-owned subsidiary, or set up a representative office for market research, Albania offers a straightforward registration process that can be completed in as little as 24 hours.

Albania's National Business Center (QKB) operates as a one-stop-shop for business registration, making the process significantly faster and simpler than in many other countries in the region. Combined with Albania's competitive tax rates, strategic location, and growing economy, this makes the country an attractive choice for international companies seeking a Balkan presence.

Types of Foreign Business Presence in Albania

Albanian commercial law recognizes three main forms of foreign business presence. Each has distinct legal, tax, and operational characteristics that make it suitable for different business objectives.

1. Branch Office (Dega e Shoqerise se Huaj)

A branch office is a direct extension of the parent company and does not have separate legal personality. It operates under the parent company's name and liability.

• Legal status — not a separate legal entity; the parent company bears full liability
• Capital requirement — no minimum capital requirement for the branch itself
• Management — must appoint an authorized representative in Albania
• Taxation — taxed on Albanian-sourced income at the standard 15% corporate tax rate
• Accounting — required to maintain separate books for Albanian operations
• Best for — companies that want to conduct commercial activities in Albania while maintaining direct control from the parent company

2. Subsidiary (Filial / Shoqeri e Re)

A subsidiary is a separate Albanian legal entity, fully or partially owned by the foreign parent company. This is the most common structure chosen by international investors.

• Legal status — separate legal entity with its own rights and obligations
• Capital requirement — 100 ALL (approximately €1) for Sh.P.K. (LLC); 3,500,000 ALL (approximately €35,000) for Sh.A. (Joint Stock Company)
• Liability — limited to the capital contributed; the parent company's assets are not at risk
• Management — must appoint at least one administrator (can be a foreign national)
• Taxation — taxed as an Albanian company at 15% corporate tax; eligible for the small business exemption if turnover is under 14 million ALL
• Best for — companies seeking limited liability, local contracts, and full operational independence

3. Representative Office (Zyra Perfaqesuese)

A representative office is designed for companies that want to explore the Albanian market without engaging in commercial activities. It cannot generate revenue or sign commercial contracts.

• Legal status — registered presence without commercial capacity
• Activities — limited to market research, promotion, liaison, and preparation for future investment
• Taxation — generally not subject to corporate income tax since it does not generate revenue
• Duration — no time limit; can be converted to a branch or subsidiary when ready
• Best for — companies conducting market research, building relationships, or planning future entry

Registration Process

The registration of a foreign company presence in Albania follows a clear, well-defined process. Albania Ekonomist manages every step on your behalf.

Step 1: Document Preparation

Before registration can begin, the following documents must be prepared:

• Resolution of the parent company's board approving the establishment of a presence in Albania
• Certificate of incorporation and articles of association of the parent company (apostilled)
• Extract from the commercial register of the parent company's country of origin (apostilled)
• Power of attorney for the authorized representative in Albania (apostilled and notarized)
• Passport copies of directors and authorized representatives
• Proof of registered address in Albania (lease agreement or property ownership)

All foreign documents must be apostilled (or legalized through the embassy) and translated into Albanian by a certified translator. Albania Ekonomist coordinates the translation and ensures all documents meet QKB requirements.

Step 2: Registration with the QKB

Once documents are complete, we submit the application to the National Business Center (QKB). The registration is typically processed within 24 to 72 hours and includes:

• Issuance of the NIPT (unique tax identification number)
• Registration in the commercial register
• Automatic notification to the tax authorities and social insurance fund

Step 3: Post-Registration Setup

After receiving the registration certificate, we proceed with:

• VAT registration (mandatory if annual turnover exceeds 10 million ALL)
• Opening a corporate bank account
• Registration of employees with social insurance
• Application for any sector-specific licenses or permits
• Setup of the accounting and bookkeeping system

Required Documents

The exact documentation depends on the type of presence being registered, but the following is a general checklist:

For a Branch Office

• Parent company registration certificate (apostilled)
• Parent company articles of association (apostilled)
• Board resolution authorizing the opening of a branch in Albania
• Appointment of the branch representative (notarized)
• Financial statements of the parent company for the most recent fiscal year
• Lease agreement for the branch office in Albania

For a Subsidiary

• Articles of Association of the new Albanian company (drafted by Albania Ekonomist)
• Shareholder resolution of the parent company approving the investment
• Passport copies of all shareholders and administrators
• Proof of registered address in Albania
• Bank certificate confirming initial capital deposit (for Sh.A.)

For a Representative Office

• Parent company registration certificate (apostilled)
• Board resolution authorizing the representative office
• Appointment of the representative (notarized)
• Description of planned activities in Albania

Capital Requirements

Albania has some of the most accessible capital requirements in Europe:

• Sh.P.K. (LLC) — minimum capital of 100 ALL (approximately €1). There is no requirement to deposit this capital in a bank before registration.
• Sh.A. (Joint Stock Company) — minimum share capital of 3,500,000 ALL (approximately €35,000). At least 25% must be deposited before registration.
• Branch office — no separate capital requirement. The branch operates under the parent company's capital.
• Representative office — no capital requirement.

Tax Obligations for Foreign Companies

Foreign companies operating in Albania through a branch or subsidiary are subject to the same tax obligations as domestic companies:

• Corporate income tax — 15% on taxable profit
• VAT — 20% standard rate (registration mandatory for turnover above 10 million ALL)
• Withholding tax on dividends — 8% on distributions to foreign shareholders
• Payroll taxes — employer contributions of approximately 16.7% of gross salary (social insurance and health insurance)
• Personal income tax — progressive rates of 0%, 13%, and 23% for employees

Albania has signed double taxation treaties with over 40 countries, including the United States, Germany, Italy, Turkey, France, and the United Kingdom. These treaties can significantly reduce withholding tax rates on dividends, interest, and royalties.

Banking for Foreign Companies

Once your company is registered, you will need a corporate bank account in Albania. We coordinate with the following major banks to ensure a smooth account opening process:

• Raiffeisen Bank Albania
• Banka Kombetare Tregtare (BKT)
• Intesa Sanpaolo Bank Albania
• OTP Bank Albania
• Credins Bank

Account opening typically takes 5 to 10 business days and requires KYC (Know Your Customer) documentation including beneficial ownership information, source of funds, and expected transaction volumes.

Frequently Asked Questions