Albania Takes a Major Step Towards Beneficial Ownership Transparency with New Law

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Tirana, Albania - In a significant move towards enhancing transparency in its business environment, Albania’s Parliament has approved Law no. 112/2020, dated July 29, 2020, establishing a register of beneficial owners.

Preventing Illicit Activities and Complying with International Standards

The new law is designed to prevent illicit activities such as money laundering and terrorist financing by requiring reporting entities to identify and register their beneficial owners. Beneficial owners are defined as individuals who ultimately own or control a legal entity, either directly or indirectly, through ownership of shares, voting rights, or other means.

Register Maintenance and Access

The National Business Center will maintain the register, which will also manage the country’s commercial register. The register will be accessible to the public, with some information available only to authorized persons and state authorities during the course of their duties.

Verification and Compliance

Tax authorities have been empowered to verify compliance with the law and confirm the accuracy of records. Fines can be imposed on reporting entities and their legal representatives for non-compliance, ranging from ALL 250,000 (approximately EUR 2,000) to ALL 500,000 (approximately EUR 4,000).

Timeline

Reporting entities will have until December 31, 2020, to identify their beneficial owners and gather relevant documentation. The register is expected to be established by January 31, 2021, with reporting entities required to register their beneficial owners within 60 days of the register’s establishment.

Reactions

The law has been welcomed as a major step towards increasing transparency in Albania’s business environment and meeting international standards on anti-money laundering and combatting the financing of terrorism.