When starting a business in Albania, choosing the right legal structure is one of the most important first steps. Each type of entity comes with its own registration process, legal responsibilities, and long-term implications. Whether you’re launching a small service or building a company for foreign investment, the legal form you choose will shape how your business operates.
Sole entrepreneur (Person Fizik)
This is the simplest business structure in Albania. It is meant for individuals operating alone, such as freelancers, small shop owners, or consultants.
The registration is fast and low-cost, and there is no separation between the business and the person. You will be fully liable for all debts or obligations. This format is best for very small operations with minimal risk.
Limited liability company (Shoqëri me Përgjegjësi të Kufizuar – SHPK)
The SHPK is the most popular choice among both Albanian and foreign entrepreneurs. It offers limited liability, meaning your personal assets are protected if the business faces legal or financial issues. Only the company’s capital is at risk.
You can register a SHPK with one or more shareholders. It requires a small minimum capital and can be used for most types of business activities. This structure is ideal for small to medium enterprises that want legal protection and operational flexibility.
Joint stock company (Shoqëri Aksionare – SHA)
The SHA is designed for larger businesses, especially those that want to raise investment or have multiple shareholders. It allows for share issuance, board governance, and more formal internal procedures. The capital requirement is much higher than for a SHPK.
This structure suits companies operating at scale, especially in sectors like manufacturing, construction, or finance. It is also the format required for businesses planning to go public or attract institutional investors.
Branch of a foreign company (Degë e Shoqërisë së Huaj)
Foreign companies can open a branch in Albania without forming a new legal entity. The branch operates under the parent company’s name and remains legally dependent on it. This option allows for local operations but does not create a fully independent business in Albania.
Branches are useful for testing the market or expanding an existing international business into Albania while keeping the legal structure centralized abroad.
Representative office (Zyra Përfaqësuese)
This type of registration allows a foreign company to open a presence in Albania for non-commercial purposes. It cannot generate income or sign contracts. Its role is limited to promotion, research, and administrative functions.
A representative office is often used when a company wants visibility or support services in Albania but is not ready to launch full operations.
How to choose the right structure
If you’re starting small with no partners, the Person Fizik model may be enough. For most businesses that want legal protection and future growth, the SHPK is the most practical and popular choice. Larger companies or those needing investors often go for the SHA. If you are expanding from abroad, the Branch or Representative Office might be the best fit depending on your activity.
Choosing the right structure from the beginning helps you avoid legal problems, control liability, and position your company correctly within Albania’s legal and tax system.