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Doing business in Macedonia |
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Macedonia prides itself with its educated, highly-qualified, and ethical workforce that is available to foreign investors. The average gross monthly salary is €390. Educational standards at technical higher educational institutions in Macedonia resemble those of the Western countries.
Workers are welcoming of continuing education and life-long learning, successfully completing customized vocational trainings. The Government is willing to help investors in the process of labor force training by participating in such programs.
English is widely spoken among Macedonia's workforce, as well as all the languages of the region: Bulgarian, Croatian, Serbian, Slovenian, Albanian and Greek.
In order to support companies and increase their international competitiveness, the Government has introduced legal reforms in the functioning of the labor market that enable easier hiring and firing of the labor force.
| - Excellent Location and Infrastructure
Strategic Location
Macedonia is at the cross-roads of South Eastern Europe, which makes it an ideal transit and distribution center for products for European markets. The developed road and railway infrastructure, in combination with the small area of the country enables access to every inhabited place in Macedonia in less than 3 hours.
The road infrastructure is 9,205 km long, while the railway network is 900 km. The two large Pan- European corridors – Corridor 8 (east-west) and Corridor 10 (north-south) currently exist and are now being upgraded. This will additionally strengthen the capacity of the Macedonian transport network. There are two international airports, in Skopje and Ohrid. There are regular direct connections to several larger European transport centers.
Telecommunications
The Republic of Macedonia has a modern digital telecommunications network. With a new interconnection agreement, fixed telephony is liberalized and entry of new operators is expected. At the moment, fixed telephone services are offered by two companies, while mobile telephony is in constant development. The presence of three mobile operators, guarantees quality and availability of services. The country’s excellent Internet access has made a very positive contribution to a positive business climate. Macedonia pursues international trends in the development of its Internet communications and enables easy and fast Internet access made via numerous Internet providers.
The leadership position of Macedonia in (Wi-Fi) wireless Internet access is of a special significance.
Energy sector
The broadly spread network for distribution and supply of electricity makes Macedonia a favorable destination for investing in every part of its territory. In 2006, the Austrian EVN undertook the supply of the domestic market with electricity. Energy sector development is a priority in Macedonia, especially taking into consideration the fact that 70% of the technically available hydro-potential is open for current and future investment.
| The lowest flat corporate and personal income tax rates Macedonia has recently become a tax heaven in Europe. The new Government introduced a flat tax of 10% for corporate and personal income. In 2007, the corporate rate is 12%, reducing to 10% thereafter. | - Registration of Companies
One-Stop-Shop System
Macedonia has introduced a one-stop-shop system that enables investors to register their businesses within 4 hours. One can register a company in Macedonia by visiting one office, obtaining the information from a single place, and addressing one employee. This significantly reduces administrative barriers and start-up costs.
The one-stop-shop system operates within the Central Register via 32 electronically integrated offices located throughout Macedonia. With the development of e-government services, company registration will soon be available online.
Access to Information on Potential Partners and Suppliers
By developing the principles of transparency and availability, the Government enables economic entities to have access to substantial and accurate data on potential business partners. The Central Register hosts an easily accessible database of companies, which is connected with the European Business Register.
Unambiguous identification of companies is provided by granting a unique registration number of registered entities, a code and title of the registered main activity according to the National classification of activities, a code of the organizational form of the registered entity, a provision of a unique tax number, and entry of a bank account chosen by the registered entity.
| Market freedom, the freedom of entrepreneurial activity, as well as property rights are fundamental values outlined in the Constitution of the Republic of Macedonia.
Right to Private Ownership and Establishment
The Constitution of the Republic of Macedonia guarantees an investor’s right to property No person may be deprived of his/her property or the rights deriving from it, unless the use of that property affects the general welfare of the public. Foreign investors may acquire property rights for buildings and for other immovable assets to be used for their business activities, as well as full ownership rights over construction land through a locally registered company, If the property is expropriated or restricted, rightful compensation of its market value is guaranteed.
The Company Law
The Company Law is the primary law regulating business activity in Macedonia. It defines the types of companies, as well as the procedures and regulations for their establishment and operations. Foreign investors receive the same treatment as local companies and therefore need not any special approvals.
Under the Company Law, trade companies are formed as separate legal entities that operate independently and are distinct from their founders, shareholders and managers. Depending on the type, trade companies have their own rights, liabilities, names and registered offices.
Law on Investment Funds
The Law on Investment Funds governs the conditions for the incorporation of investment funds and investment fund management companies. It also regulates the manner in which a company operates and exercises supervisory control of these operations and the process of the selection of a depository bank. The law does not discriminate against foreign investors in the establishment of open-ended or closed investment funds.
Price controls
Price liberalization in Macedonia has been essentially completed. Price controls exist for only very few products. Prices in the energy sector (oil derivatives, electricity) are controlled by independent regulatory bodies.
Competition
The Macedonian Law on Competition ensures that the task of the right of competition is to prevent certain practices and business activities on the market, which certain undertakings will use to achieve an unjustified advantage compared to other undertakings and to jeopardize the free competition among undertakings.
Monopolies and Antitrust
The Law Against Limiting Competition (LALC), drafted on the basis of The German Act against Restraints on Competition, came into force on 1 April 2000, thus establishing the Monopoly Authority (MA) as a body within the Ministry of Economy. This law guarantees the protection of competition, in cases where competition is distorted by collusive agreements, abuse of a dominant position in the market, or merger agreements among companies that lead to the creation of a dominant position or the strengthening of existing dominant positions.
Securities markets
The Central Securities Depository (CSD) records the existence of an ownership of shares and associated transactions. The CSD has greatly improved the efficiency of the capital markets and the rights of minority shareholders in companies. All joint stock companies have transferred their shareholding books to the CSD.
| According to the Company Law, all legal entities are obliged to prepare annual accounts at the end of each calendar year. Annual accounts have to be prepared in accordance with local accounting rules. | Foreign residents can easily establish employment in the Republic of Macedonia, after getting an appropriate visa or permit from the Ministry of Internal Affairs.
Types of visas:
- Entry visa,
- Business visa,
- Employment visa.
Types of permits:
- Work Permit,
- Residence Permit.
| In addition to the registration of all business activities as stipulated by the Company Law, some business activities must obtain additional working licenses or permits before starting their operations. | Three multilateral and eight bilateral free-trade agreements give Macedonia duty free access to more that 650 million consumers from the EU member-states, the EFTA and CEFTA countries, as well as Turkey and the Ukraine.
| Foreign individuals can acquire property in Macedonia through a registered local company in the same way as domestic legal entities. | Considerable steps are taken to establish a system of integrated permits for industrial facilities considered to be significant polluters. | - Dispute resolution mechanisms
Domestic sources of the Macedonian Arbitrary Law include the Constitution of the Republic of Macedonia, the Litigation Procedure Law (Official Paper of SFRY, No. 4/77), the Law on Disputes Settlement (Official Paper of SFRY, No. 43/82), and the Macedonian Company Law. The international sources of the Macedonian Arbitrary Law include bilateral and multilateral conventions, which Macedonia has signed or inherited from former Yugoslavia on the basis of succession. The Republic of Macedonia is a party to the New York Convention on Recognition and Enforcement of Foreign Arbitral Awards as well as the Geneva Convention on Execution of Foreign Arbitral Awards. Macedonia is also a party to the Washington Convention on the Settlement of Investment Disputes Between States and Nationals of Other States and the European Convention on International Commercial Arbitration. By virtue of the Macedonian Law, ratified international agreements have preference over domestic legislation |
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Doing business in Macedonia 
