On April 23, 2026, the Assembly adopted law no. 42/2026 “On the freedom of establishment and provision of services in the Republic of Albania”. The law was decreed by the President on May 13, 2026, and enters into force 15 days after its publication in the Official Gazette. This is a legislative step that directly brings Albanian service regulation closer to European Directive 2006/123/EC.
The purpose of the law is to facilitate the freedom of establishment of service providers and the freedom to provide cross-border services. It repeals Law no. 66/2016 and establishes new principles for authorizations, administrative procedures, and the rights of service providers and beneficiaries.
The impact affects two groups of businesses. Foreigners who want to establish themselves or offer services in Albania and Albanian providers aiming to expand their activities in EU member states. Below, we explain what the law entails in practice, what opportunities it creates, which sectors remain outside its scope, and when the main provisions take effect.
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What does law 42/2026 bring
The law lays down general provisions facilitating the exercise of freedom of establishment by service providers and the freedom to provide cross-border services. It transposes the Directive 2006/123/EC to the European Parliament and repeals the previous law no. 66/2016 “On Services in the Republic of Albania”.
Four core principles of law
The logic of the law is based on four main principles: Non-discrimination on the basis of nationality or residence; Justification of any restriction by overriding reasons of public interest; Proportionality of administrative measures; Transparency of procedures and criteria.
Authorization Schema Evaluation Filters
Any existing or future authorization scheme must undergo an assessment filter. If it is not non-discriminatory, justified, and proportionate, the competent authorities are obliged to take measures to adapt or repeal the relevant provisions.
What changes for foreigners opening a business in Albania
The law removes a series of barriers that in practice have made it difficult for foreigners wishing to invest in Albania. Article 6 explicitly prohibits the application of discriminatory criteria related to citizenship or seat location. More specifically, several specific requirements are prohibited.
- The requirement that the service provider, personnel, shareholders, partners, or members of governing bodies be Albanian citizens.
- The requirement for these persons to have residency or residence in the territory of Albania.
- Authorization conditioned on an economic test or market need tests.
- The obligation to have the main settlement in Albania.
- Reciprocity conditions with the applicant's country of origin.
- The obligation to have been previously registered in the Albanian registers for a specified period.
For an Italian, French, or German entrepreneur who wishes to open an LLC in Tirana or Durrës, this means they are no longer required to formally appoint an Albanian administrator or prove prior connections to Albania. The registration and authorization process is subject to the same conditions as for a local entrepreneur.
What changes for Albanian businesses offering services abroad
For Albanian providers who want to expand their activities in EU member states, the law provides greater freedom for the provision of cross-border services. According to Article 12, a provider established in a member state has the right to provide services in Albania without the obligation to establish themselves there. The same principle will apply to Albanian providers in EU member states.
Albanian businesses offering consulting, accounting, IT, marketing, architectural design, or similar services will be able to offer these services to clients in the EU without being required to open a branch or subsidiary in the host country.
This relates to another important provision. The law prohibits requests for specific identification documents, requests for prior authorization simply because the provider is from another country, and restrictions on equipment or materials necessary for providing the service.
However, it should be emphasized that the full entry into force of these provisions for cross-border services is linked to Albania's membership in the European Union or earlier reciprocity agreements. Until then, the current bilateral rules with each state apply.
e-Albania as a Single Point of Contact
One of the most tangible changes in practical terms is Article 15. The e-Albania portal is officially designated as the Single Point of Contact (SPOC) for all procedures and formalities related to entering a service activity.
Through the PVK, providers will be able to perform several procedures centrally.
- Declarations, notifications, and authorization requests.
- Registration in registers, lists, or databases.
- Registration with professional bodies or organizations.
- Applications for any authorization required to carry out the activity.
According to Article 18, all procedures must be carried out easily, remotely, and electronically. The only exceptions are physical inspections of premises and equipment, or personal verifications of professional integrity.
The PVK must provide information in Albanian and English regarding applicable requirements, contact details of competent authorities, appeal mechanisms, and all necessary data for businesses operating in Albania.
Authorization procedures and deadlines
The law sets some rules that limit the discretion of the administration.
According to subsection 9, authorizations are issued indefinitely, except when a time limitation is justified for compelling reasons of public interest or when resources are naturally limited.
According to Article 10, each procedure must be completed within a reasonable timeframe, which is determined and made public in advance. The timeframe begins when all documentation has been submitted and may be extended only once, by a reasoned decision that is communicated to the applicant before the initial deadline expires.
In the absence of a response within the timeframe, the authorization is considered implicitly approved. Exceptions are permitted only for compelling reasons of public interest, including the legitimate interest of third parties.
Application fees must be proportional to the cost of the procedure and cannot exceed the administrative cost of the service.
Which sectors remain outside the scope of the law
The law has a broad but not unlimited scope of application. According to Article 2, it does not apply to certain categories of services.
- Financial services, including banking, insurance, reinsurance, investment funds, and investment advice.
- Electronic communications services for matters governed by sector-specific legislation.
- Road, rail, sea, and air transport services.
- Temporary employment agency services.
- Healthcare services.
- Audiovisual and radio services.
- Gambling and betting.
- Social services for families and individuals in need.
- Private security services.
- Services provided by notaries and bailiffs.
Likewise, Article 2(2) explicitly states that the law does not apply in the field of taxation. Tax obligations, declarations, taxes, and tax administration remain governed by Law No. 9920/2008 on Tax Procedures and by other specific tax legislation.
What should businesses do now
For businesses that are already operating or are planning to enter the market, some points are practical from the moment the law takes effect.
Authorization requirement verification
If your activity requires a license, permit, or authorization, the conditions must be non-discriminatory, justified, and proportionate. Any requirement that does not meet these conditions may be reviewed or revoked.
Use of PVC
Registration and authorization procedures will increasingly move to e-Albania. Familiarization with the portal and electronic documentation is essential.
Information for beneficiaries
According to Article 22, providers must make clear information available to customers regarding their name, legal form, address, commercial registration, tax identification number, contractual terms, predetermined price, and professional guarantees. Websites and commercial materials must be updated with this data.
Review of standard contracts
According to Article 19, providers may not discriminate against beneficiaries on the basis of nationality or place of residence. The general conditions for access to services must be reviewed if they contain such provisions.
When does the law come into effect
The law enters into force 15 days after its publication in the Official Gazette. Certain provisions closely related to the accession to the European Union or to administrative cooperation with the European Commission, according to Article 41, shall enter into force on the date of accession to the EU or earlier if provided for by agreement or by the principle of reciprocity.
Within six months of its entry into force, the Council of Ministers must adopt the relevant sub-legislative acts. Until they are approved, the current acts issued for the implementation of Law No. 66/2016 shall continue to apply.
Why it Matters
Law No. 42/2026 is not just a regulatory reform. It clearly signals the direction in which Albanian legislation has moved toward alignment with the EU's internal market. For foreign entrepreneurs who viewed Albania as an investment destination, this is an additional institutional guarantee. For Albanian businesses building client portfolios in Italy, Germany, or other member states, the law lays the legal foundations for freer cross-border expansion after membership.
In practice, the changes will be felt gradually. Some, such as the removal of discrimination in authorization conditions or the use of the PVK, take effect immediately. Others, such as the full freedom of cross-border services with the EU, will be activated upon membership.
For an Albanian business offering services, or for a foreign investor evaluating Albania, the legal framework has become more transparent, more predictable, and more aligned with European standards.
Every time there is a tax or financial change that affects your business, we notify you directly by email with a practical explanation.
Send me free notificationsFrequently Asked Questions
Do I need to re-register my business after the law comes into effect?
The law does not provide for the re-registration of existing businesses. It mainly affects new authorization procedures and rules for providing services.
How does the law affect my business's tax obligations?
There is no direct impact. According to Article 2(2), the law does not apply to the field of taxation. Tax obligations, declarations, and taxes remain governed by Law No. 9920/2008 on Tax Procedures and by other specific tax legislation.
As a foreigner, can I immediately open an LLC in Albania without an Albanian administrator?
Even though in practice it was possible to register an LLC by foreigners before, Law 42/2026 explicitly makes illegal any request that would condition registration on Albanian citizenship or residency of the partners or administrators.
Is the full operation of Albanian businesses in the EU legally enabled?
Immediate implementation. Full freedom for cross-border service provision with the EU, according to Article 41, enters into force on the date of accession to the European Union or earlier by mutual agreement. Until then, current bilateral rules with each state apply.
What is the Single Point of Contact and how does it work?
The Single Point of Contact (SPC) is the e-Albania portal, which, pursuant to Article 15, has been designated as the central point for all procedures and formalities related to the commencement of a service activity. Through it, declarations, notifications, authorization requests, and registrations with the competent authorities are carried out.
How long do authorities have to issue an authorization under the new law?
According to Article 10, the authorities must examine the request within a reasonable period, which shall be determined and made public in advance. The period may be extended only once, by a reasoned decision. In the absence of a response, the authorization shall be considered tacitly approved, except in cases justified by public interest.
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