Page 185 - Albanian law on entrepreuners and companies - text with with commentary

Article 172
Capital Increase and Change of a Single-Member Company Status

A single-member company may use the capital increase to change its status and
become a multi-member company by issuing shares to new shareholders. The change
must be reported to the National Registration Centre.

CHAPTER II
INCREASE OF CAPITAL BY ISSUING NEW SHARES

Article 173
Conditions
Basic capital may be increased by issuing new shares against new contributions.

Article 174
Pre-emption Right
(1) All shareholders shall have a pre-emption right in respect of the newly issued
shares in proportion to the par value of their previous capital portion. The right must
be exercised within 20 days after the disclosure required by Article 169.
(2) The right referred to in paragraph 1 may be restricted or withdrawn by the
decision of the General Meeting on the increase of basic capital. The Managing Director
shall be required to present to such a meeting a written report indicating the reasons for
restriction or withdrawal and justifying the proposed issue price. The decision may only
be taken if the restriction or withdrawal was announced on the company’s website and
reported to the National Registration Centre.

Comments:

1. Article 29 (1) Second Directive (as amended) requires that shares must be offered on a
pre-emptive basis to the shareholders in proportion to the capital represented by their share.
Article 174 (1) says exactly this.

2. Article 29 (3) Second Directive requires that pre-emption rights and the period it can
be exercised be disclosed by the usual means of disclosure of company data in accordance
with the First Directive. Because Albanian JSCs have only registered shares, the
announcement can be made by writing to the shareholder. On the other hand, all capital
increase procedures must be disclosed in accordance with Article 169, so no writing to
shareholders is necessary anyway. Article 174 (1) makes it clear that the deadline is
compulsory: “The right must be exercised within 20 days after the disclosure required by
Article 169.”

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