North Macedonia: Enabling future investments in start-ups

Amendments to the Company Law (2004) to Provide Opportunities for Start-up Companies in North Macedonia

In April 2022, the Assembly of the Republic of North Macedonia adopted amendments to the Company Law (“Law”) which will open new opportunities for business angels to invest in start-up companies. The main purpose of the amendments is to encourage innovation and development in the start-up ecosystem of North Macedonia.

One of the key amendments to the Law relates to the convertible loan as a financing tool for companies in their early development. Prior to the amendments, converting a loan into share capital was only possible if the loan was provided by the sole shareholder of a company with one shareholder. This often held back business angels from investing in start-up companies in North Macedonia. However, the new provisions provide a possibility for third parties, i.e., investors to provide loans which can convert into shares no later than the end of the third year after signing the loan agreement. The novelty allows investors to have the option to convert the loan into a share in the company once a realistic assessment of the value of the company is possible.

The amendments also envisage new mandatory elements which must be included in annual reports adopted by joint-stock companies at annual general assemblies. As such, annual reports must now also contain detailed data on the income of all members in the management bodies, as well as detailed data regarding the employment relations of all members in the management bodies with other employers.

The amendments to the Law were adopted because of increased interest in investment in start-ups in North Macedonia and on the recommendation of the World Bank in the 2020 Doing Business Report.


The information in this document does not constitute legal advice on any particular matter and is provided for general informational purposes only.