Page 68 - Albanian law on entrepreuners and companies - text with with commentary

The practice created during the implementation of Law No. 9901 showed uncertainties
among businesses in terms of what measures should Managing Directors or members take in
order to avoid personal liability under Article 16 (1) c).
It should be noted that Article 16 (1) c) in no case obliges any members to assume any
additional contributions to the company equity, but gives them the optional choice of further
financing if they are interested in continuing the operations or taking a decision for the
liquidation or bankruptcy of the company.
With regard to this concern, and to clarify that Article 16 of Law No. 9901 does not
provide for an obligation for a company members to assume the provision of additional
contributions to its equity, it was deemed reasonable to reformulate Article 16 (1) c) so that it
clarifies that a Managing Director, member or shareholder of a company is personally liable
towards third parties only if at a time when he/she knew that the company did not have
sufficient capital to ensure normal operation, he/she did not take the necessary actions to
impede the company to continue its business and/or to assume new commitments towards
third parties, including public authorities.
Finally, on the basis of the constitutional principle of proportionality, it was deemed
reasonable to provide that any personal liability of a Managing Director, member or
shareholder deriving from a violation of the provisions of Article 16 should not exceed the
amount of a damage that creditors have incurred as a result of that particular violation.
Therefore, Article 16 as amended in 2014 provides that:

 in the case of abuse of the legal form of the company for achieving unlawful goals,
the personal liability will be up to a value equal to the total amount of outstanding
company obligations;
 in the case of treating company assets as if they were his/her own assets, the
personal liability will be up to the current market value of the company assets
treated as if they were his/her own assets (e.g. registering their assets on the name
of the company for the purpose of receiving more favourable legal treatment);
 in the case of allowing the company to continue its business and/or to assume new
commitments towards third parties, including public authorities, the personal
liability will be up to a value equal to the total amount of outstanding company
obligations incurred after the moment he/she know or must have known of the
inadequacy of the capital required to continue operation.

9. Finally, given that the cases covered by Article 16 involve ‘residual’ liability, i.e. cases
where there would not normally be any legal liability, it was clarified that the responsible
members or shareholders pursuant to Article 16 are only individuals and not legal persons
(legal persons would fall in similar liabilities based on the group provisions, of Article 206
and following of the Company Law).
This clarification is merely a better alignment of the legal provisions; however, it does
not exempt legal persons from liability in those cases. Pursuant to Articles 209 and 210 of
Law No. 9901, the controlling member/shareholder (legal person) which through his

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