A P r ac t i c a l G u i d e. on Doing Business in Albania

Transcription

1 A P r ac t i c a l G u i d e on Doing Business in Albania 1

2 Table of Contents Registration of a Branch Office General overview 6 Documents to be filed 7 Terms, legalization process and official fees 8 Other registrations and declarations 9 Registration of a Limited Liability Company General overview 12 Documents to be filed applicable to both foreign legal entity and individuals as future shareholders 13 Additional documents to be filed applicable only if the future shareholder is a foreign legal entity 14 Additional documents to be filed applicable only if the future shareholders are individuals 15 Terms, legalization process and official fees 16 Other registrations and declarations 17 Registration of a Tax Representative General overview 20 Documents to be filed 21 Terms, legalization process and official fees 22 Other registrations and declarations 23 Work and Residence Permits How to obtain work permit 26 How to obtain residence permit 29 Notes for both procedures (work and residence permit) 31 1

3 Boga & Associates Services at a Glance! Boga & Associates, established in 1994, has emerged as one of the premier law firms in Albania, earning a reputation for providing the highest quality of legal, tax and accounting services to its clients. Boga & Associates also operates in Kosovo (Pristina) offering full range of services. Until 1 st of May 2007, the firm was a member firm of KPMG International and the Senior Partner/Managing Partner, Mr. Genc Boga was also Managing Partner of KPMG Albania. Our firm s particularity is linked to the multidisciplinary services it provides to its clients. Apart of the wide consolidated legal practice, the firm offers also a significant expertise in tax and accounting services with a keen sensitivity to the rapid changes in the Albanian and Kosovar business environment. Boga & Associates is recognized as a top tier firm by the most prestigious ranking companies in Corporate/Commercial, Dispute Resolution, Intellectual Property, Real Estate by Chambers and Partner (2012), Financial and Corporate Law as well as Mergers and Acquisition by IFLR (2012). The firm is praised by clients and peers as a law firm with high-calibre expertise and is distinguished among the elite in Albania and as accessible, responsive and wise. Areas of practice LEGAL: Commercial, Corporate, Mergers and Acquisitions, Banking and Finance, Competition, Employment, Construction, Telecommunication, Oil and Energy, Procurement, Environment, Real Estate, IP, Litigation, etc. TAX: Tax Advice, Compliance, Audit, Litigation. ACCOUNTING: Accounting, Bookkeeping and Payroll. Languages spoken: Albanian, English, French, Italian, Greek, German. Offices: Albania Deshmoret e 4 Shkurtit str. P.O. Box 8264 Tirana, Albania Telephone: / Fax: boga@bogalaw.com Kosovo Nena Tereze str. Entry 30, No. 5 Pristina, Kosovo Telephone: Fax:

4 Registration of a Branch Office General overview Documents to be filed Terms, legalization process and official fees Other registrations and declarations 5

5 General overview A foreign company may organize its business in Albania through establishment of a branch. Considering that the parent company and the branch have the same legal personality, there are no capital requirements (the parent company may allocate to the branch the funds considered opportune and appropriate for the branch to conduct its activity in Albania). The branch is managed by one or more managers, foreigners or Albanian. Registration with the Albanian Commercial Register kept by the National Registration Center ( NRC ) implies also registration for tax purposes. Upon completion of the procedures of registration, the NRC issues to the branch the business number (which is also used as tax identification number) and the certificate of registration. 6 Registration of a Branch Office

6 Documents to be filed Documents to be filed with Albanian Commercial Register 1. Application form 2. Resolution of decision making body of parent company on establishment of the branch (notarized) 3. Articles of Incorporation and/or Bylaws of the parent company 4. Extract of the Chamber of Commerce of the country where the parent company is registered 5. Good standing Certificate issued by the relevant authority in the country where the parent company is registered 6. Copy of branch manager (s) passport/id card and simple photocopy of parent company s head officer 7. Latest financial statements of parent company (if it has conducted its activity for more than 1 year) and audit report 8. Power of attorney issued by the branch manager (s) for performing registration process (notarized) 7

7 Terms, legalization process and official fees The application form along with the above documents must be filed within 15 days from the establishment of the branch (i.e. from the date of signature of the resolution on establishment); otherwise, a penalty in the amount of Leke 15,000 (approx. EUR 110) applies. All the documents presented for registration purposes/filing with Albanian public authorities (including the NRC), in foreign language and executed abroad or issued by foreign public authorities should be in original or certified true copies (only one original or certified copy is needed). They should be legalized (with apostille, if applicable, by the competent authorities in accordance with the Hague Convention dated 5 October 1961). Such documents must be then translated into Albanian language and such translation must be notarized (certified) by a notary public. Under the National Registration Center legislation, the certificate of registration of a new business must be issued by NRC within one day from the application date if the presented file is accurate and complete. However, in practice, the registration with the NRC takes approximately 2-3 days. The official fees for establishment and registration of the branch with the NRC consist of the following: Registration with the NRC: Leke 200 (approx. EUR 2) Notary Public fees (approx.): Leke 8,000 (approx. EUR 55) + VAT (at 20%) 8 Registration of a Branch Office

8 Other registrations and declarations Registration with NRC Declaration to tax authorities of annual turnover foreseen for the year Municipal Local Taxes Directorate Documents to be filed (as copies) Passport/ID card of the manager of the branch NRC extract and certificate of registration Lease contract for the premises where the legal seat located 9

9 Registration of a Limited Liability Company General overview Documents to be filed applicable to both foreign legal entity and individuals as future shareholders Additional documents to be filed applicable only if the future shareholder is a foreign legal entity Additional documents to be filed applicable only if the future shareholders are individuals Terms, legalization process and official fees Other registrations and declarations 11

10 General overview The limited liability company is the most common and preferred legal form for conducting business in Albania. It has the following features: minimum share capital is Leke 100 (approximately EUR 1); no limitation on the number of shareholders, either individuals or legal entities, foreigners or Albanian; it may be managed by one or more individuals, either foreigners or Albanian. Registration with the Albanian Commercial Register kept by the National Registration Center ( NRC ) implies also registration for tax purposes. Upon completion of the procedures of registration, the NRC issues to the new company the business number (which is also used as tax identification number) and the certificate of registration. 12 Registration of a Limited Liability Company

11 Documents to be filed applicable to both foreign legal entity and individuals as future shareholders Applicable to both foreign legal entity and individuals Application form Articles of Incorporation and/or Bylaws of the new company Copy of the passport/id card of the administrator (s) of the new company Power of attorney for performing registration process To be notarized by a Notary Public 13

12 Additional documents to be filed applicable only if the future shareholder is a foreign legal entity Sole shareholder Foreign Legal Entity Resolution of decision making body on establishment of new company (notarized) Articles of Incorporation and Bylaws of Sole shareholder and amendments Extract of the Chamber of Commerce of the country where the Sole shareholder is located Good standing Certificate issued by the relevant authority in the country where the Sole shareholder is located Issued no before than 90 days from application date 14 Registration of a Limited Liability Company

13 Additional documents to be filed applicable only if the future shareholders are individuals Individuals as shareholders Notarized copy of identification card or passport 15

14 Terms, legalization process and official fees The application form along with the above documents must be filed within 15 days from the establishment of the new company (i.e. from the date of signature of Articles of Incorporation and/or Bylaws); otherwise, a penalty in the amount of Leke 15,000 (approx. EUR 110) applies. All the documents presented for registration purposes/filing with Albanian public authorities (including the NRC), in foreign language and executed abroad or issued by foreign public authorities should be in original or certified true copies (only one original or certified copy is needed). They should be legalized (with apostille, if applicable, by the competent authorities in accordance with the Hague Convention dated 5 October 1961). Such documents must be then translated into Albanian language and such translation must be notarized (certified) by a notary public. Under the National Registration Center legislation, the certificate of registration of a new business must be issued by NRC within one day from the application date if the presented file is accurate and complete. However, in practice, the registration with the NRC takes approximately 2-3 days. The official fees for establishment and registration of the new company with the NRC consist of the following: Registration with the NRC: Leke 200 (approx. EUR 2) Notary Public fees (approx.): Leke 8,000 (approx. EUR 55) + VAT (at 20%) 16 Registration of a Limited Liability Company

15 Other registrations and declarations Registration with NRC Declaration to the tax authorities the annual turnover foreseen for the year Municipal Local Taxes Directorate Documents to be filed (as copies) Passport/ID card of the administrator of the new company NRC extract and certificate of registration Bylaws of the new company Lease contract for the premises where the legal seat is located 17

16 Registration of a Tax Representative General overview Documents to be filed Terms, legalization process and official fees Other registrations and declarations 19

17 General overview If a foreign entity does not have a permanent establishment in Albania, but is liable for VAT, it may appoint a tax representative for VAT purposes. The tax representative may be an individual or a legal entity. The tax representative must be registered with the Albanian Commercial Register kept by the National Registration Center ( NRC ). Registration with the Albanian Commercial Register implies also registration for tax purposes. Upon completion of the procedures of registration, the NRC issues to the tax representative the business number (which is also used as tax identification number) and the certificate of registration. 20 Registration of a Tax Representative

18 Documents to be filed Documents to be filed with Albanian Commercial Register 1. Application form 2. Representation act i.e. power of attorney or agreement between the foreign entity and tax representative (notarized) 3. Articles of Incorporation and/or Bylaws of the foreign entity 4. Extract of the Chamber of Commerce of the country where the foreign entity is located 5. Good standing certificate issued by the relevant authority in the country where the parent company is located 6. Notarized copy of identification card of the tax representative (if the latest is a natural person) 7. Notarized decision of competent body of the tax representative (if the latest is a legal entity) 8. Power of attorney issued by the tax representative for performing registration process (notarized) 21

19 Terms, legalization process and official fees The application form along with the above documents must be filed within 15 days from the appointment of the tax representative; otherwise, a penalty in the amount of Leke 15,000 (approx. EUR 110) applies. All the documents presented for registration purposes/filing with Albanian public authorities (including the NRC), in foreign language and executed abroad or issued by foreign public authorities should be in original or certified true copies (only one original or certified copy is needed). They should be legalized (with apostille) by the competent authorities in accordance with the Hague Convention dated 5 October Such documents must be then translated into Albanian language and such translation must be notarized (certified) by a notary public. Under the National Registration Center legislation, the certificate of registration of a new business must be issued by NRC within one day from the application date if the presented file is accurate and complete. However, in practice, the registration with the NRC takes approximately 2-3 days. The official fees for establishment and registration of the tax representative with the NRC consist of the following: Registration with the NRC: Leke 200 (approx. EUR 2) Notary Public fees (approx.): Leke 8,000 (approx. EUR 55) + VAT (at 20%) 22 Registration of a Tax Representative

20 Other registrations and declarations Registration with NRC Declaration to tax authorities of annual turnover foreseen for the year Municipal Local Taxes Directorate Documents to be filed (as copies) Passport of the tax representative NRC extract and certificate of registration of the tax representative Lease contract of premises where tax representative is located 23

21 Work and Residence Permits How to obtain work permit How to obtain residence permit Notes for both procedures (work and residence permit) 25

22 How to obtain work permit Foreigners seeking to work in Albania should obtain a work permit. However, the foreign individuals falling into the following categories may be exempted from the obligation to obtain the work permit (once they have applied for exemption status): (i) (ii) (iii) (iv) (v) (vi) (vii) (viii) (ix) counselors or advisors of governmental institutions; members of technical assistance missions of international organizations attached to governmental institutions; representatives of the international organizations having diplomatic status; foreigners who in accordance with the international law enjoy diplomatic privileges and immunities; staff of international transportation companies, staying no longer than three months in the Albanian territory; foreign members of the military forces or civil units of a NATO member; persons holding more than one citizenship, one of which is the Albanian citizenship; representatives of mass media, correspondents or reporters, accredited in the Republic of Albania, who work for foreign employers; foreigners who negotiate an agreement or participate in a trade exposition for a duration up to one month; 26 Work and Residence Permits

23 (x) (xi) (xii) (xiii) (xiv) (xv) foreigners, who within one month, undertake installation of machineries or constructions which are delivered by a foreign company, and are also in charge with its maintenance and training of the local staff; representatives of non for-profit governmental organizations who are not remunerated for their work; representatives of religious or humanitarian institutions registered with the Albanian competent authorities who are not remunerated for their work; crew of ships or aircrafts with a temporary staying up to three months in the Republic of Albania; business visitors who stay less than one month in the Republic of Albania; lecturers, researchers who come in the Republic of Albania pursuant to bilateral agreements or educational institutions agreements. 27

24 The documents required to be filed for obtaining the work permit are the following: 1. Personal request with the foreigner s data as per the standard application form filled in and signed by the foreign citizen; 2. An extract of registration of the employer issued by the National Registration Center; 3. Individual employment contract; 4. Copy of the passport of the foreign citizen; 5. Five (5) photos. The above documents might slightly vary depending from the type of the work permit requested. The application file should be submitted with the Directorate of Migration Policies. The said Directorate must notify its decision on issuance or exemption from the work permit within 10 working days from the date of the submission of the documentation; anyhow, in practice the work permit is issued within one month period. The official fee to be paid for the work permit is Leke 6,000 (approx. EUR 45). 28 Work and Residence Permits

25 How to obtain residence permit Foreigners entering the Republic of Albania without a visa may stay within the Albanian territory up to 90 days for a period of 180 days from the date of their entrance into the Albanian territory. In case the said term is exceeded the residency permit is required. In order to obtain the residence permit the application must be filed 30 days prior the expiring of the staying term (within 60 days from the first entry for foreigners entering the country without visa). The following documents must be submitted at the Local Police Station, where the foreigner resides: 1. Application form for the residence permit to be filled in and signed by the applicant; 2. Passport of the applicant as well copy of the pages bearing official notes and the last entry into Albania. The passport should be valid for at least 3 months after the expiry of the residence permit term; 3. Legalized criminal record certificate of the applicant obtained in the country of origin issued in the last 6 months; 4. Lease contract of the premises where the applicant is residing; 5. Legalized birth certificate, obtained in the country of origin issued in the last 6 months; 29

26 6. 2 (two) photos; 7. Declaration issued by the employer on the reasons of staying of the foreigner; 8. Copy of the work permit. The official fee for issuance of the one year duration residence permit, payable to the Local Police Station, is Leke 10,000 (approx. EUR 75). The foreigner applying for the residence permit must be personally present at the Local Police Station and the residence permit shall be issued within 30 days from the application date. 30 Work and Residence Permits

27 Notes for both procedures (work and residence permit) In order to obtain work and/or residence permit, all documents executed abroad and/or issued by foreign public authorities should be legalized with Apostille in accordance with the Hague Convention of October 1961 if the country of residence of the foreigner has ratified such Convention and has not expressed any reserve as regards its application in Albania; otherwise, the so-called long legalization procedure should be followed. They shall be then translated into Albanian language and notarized by an Albanian notary public. 31

28 Practical Guide is a free electronic publication edited by Boga & Associates. The information contained in this publication is of a general nature and is not intended to address the circumstances of any particular individual or entity. Practical Guide is not intended to be and should not be construed as providing legal advice. Although we endeavor to provide accurate and timely information, there can be no guarantee that information contained in this feature is accurate as of the date it is consulted or that it will continue to be accurate in the future Boga & Associates. All rights reserved. This publication is copyrighted and is protected to the full extent of the law. Nevertheless, you are free to copy and redistribute it on the condition that full attribution is made to Boga & Associates.