Page 139 - Albanian law on entrepreuners and companies - text with with commentary

2011-2012 discussion review for the amendments to the Company Law a proposed
consequential amendment was made to align Article 114 (2) with Article 71 (for LLCs).

2. On the other hand, a single-shareholder company may easily change its status and
become a multi-member company by using the instrument of an increase of capital and/or
transferring shares to new members, Article 172. Also this change must obviously be reported
to the Registry, Article 172, Article 43 Business Registration Law. As regards the special anti-
self-dealing clause for single member companies, please, consult our Comments to Article 13.
Also see our Comments to Article 71 on single member LLCs.

Article 115
Procedure for Formation
(1) Joint stock companies are formed by registration as of Article 106 following the
adoption of the Statute by the founders. The Statute shall determine the first Managing
Directors and the first members of the Board of Directors or of the Supervisory Board.
Their appointments expire on the date of the first General Meeting.
(2) Payments with respect to paragraph 1 of Article 113 shall be made into a
designated bank account as defined by the Statute. A statement of the bank confirming
the deposit of cash-contributions will be submitted to the National Registration Centre
together with the application for registration.
(3) The withdrawal of funds resulting from contributions in cash by the
representative of the company can only be carried out after its registration with the
National Registration Centre.

TITLE II
SHARES

Comments:

JSC membership is represented by shares in the company's capital. In this respect, the
Company Law makes a decisive difference from the former Company Law No. 7638. While
Article 198 of Law No. 7638 allowed for bearer and registered shares, the new Company Law
declares registered shares as its exclusive share model, Article 119. Bearer shares can be
transferred without any formal procedures while registered shares (or shares ‘on the name’)
require registration in order to transfer the ownership of the share and inherent rights to
another person. For reasons of transparency of membership, modern corporate governance
regimes have increasingly become sceptical towards bearer share systems and insist that the
registered shares system was preferable. 138 Albanian law-makers followed this legal policy
trend and abolished bearer shares and any other form of transfer which would result in a

138 See above Comments before Article 105.
138