Page 97 - Albanian law on entrepreuners and companies - text with with commentary

(2) Where the company has created a website, all data reported to the National
Registration Centre shall be placed on this website and be available to every interested
person.

Article 70
Basic Capital
The basic capital shall not be less than 100 Lekë.

Comments:

1. The 2008 Company Law has radically reduced the legal minimum capital requirements
of the old Company Law No. 7638. Consequently, it has nearly abandoned capital
maintenance provisions. The only provision which is left is the capital requirement of
minimum capital which is set at a very low amount. This solution is one of the main aspects
of the new and flexible LLC design. There are no European legal acts preventing such a
radical reduction or even the complete abolition of minimum capital requirements for LLCs.
According to EU Law, the ‘price’ for limited liability (i.e. absence of personal liability of
shareholders) of JSCs consists of the protection of shareholders and creditors by minimum
capital requirements, i.e. these companies must have a fixed capital the minimum amount of
which is set by law. This concept found its regulatory expression in the Second Directive
77/91/EEC and was extended to LLCs in most of the Member States with civil law systems.

2. However, there has been much debate in recent years on the usefulness of this concept.
The minimum capital is only ‘safe’ when the company is founded. If it is then consumed by
the losses of everyday business, the protection is gone. This consumption of guaranteee
capital is quite normal if the amount established at the beginning is not enough to carry out
the company’s purposes. The advent of innovative new technologies means that money can
very rapidly be transferred across the world. It is therefore very difficult to keep track of the
amount of money in company accounts at any particular time. It is therefore sensible to
abandon the old systems which relied on bookkeeping for a system which penalises managers
with personal liability if they misuse the limited liability form of business.

3. The debate gained momentum 107 when the ECJ ruled that Freedom of Establishment
requires Member States to permit companies with a flexible (capital) design founded in other
Member States to operate freely within their territory regardless of how restrictive the local
model is. This may lead to a situation where LLCs founded in accordance to the more rigid
rules of a Member State may be outnumbered by LLCs founded in accordance with the more
flexible rules of another Member State. We recall the example of Germany where more than
40,000 English Limited Companies were registered in only a few years. Albania wanted to

107 We mentioned this also in our Comments to Article 8 with respect to the ‘conflicts of laws’ and relevant Albanian
International Private Law.
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