Foreign direct investment in North Macedonia is at record levels: according to the Agency for Foreign Investments and Export Promotion, inflows between July 2024 and June 2026 exceeded 1.3 billion euros. One of the routes through which foreigners enter the market is not founding a new company, but acquiring a share in an existing one, with registration, employees, contracts and licences already in place. The transaction is faster than starting from zero, but it buys the company's entire history as well, including obligations that are nowhere to be seen in the records. Here is what must be checked before signing.
Why do investors acquire a share in an existing company instead of founding a new one?
Acquiring a share in an existing company delivers an immediately operational entity: registration, tax number and VAT status, bank accounts, employees, contracts with clients and suppliers, and licences that would otherwise take months to obtain. With a newly founded company, all of this is built from scratch. The difference lies in the risk: the buyer of a share takes over the company with all of its obligations, both those recorded in the books and those recorded nowhere at all.
What does legal due diligence cover before an acquisition?
Legal due diligence is a systematic review of the company before the contract is concluded: ownership and shares, financial statements and tax status, litigation and enforcement proceedings, contracts, employees, real estate and permits. The goal is not a formality, but to discover what is actually being bought and to price the transaction according to the real risk.
- Central Registry: current status, owners, managers, statutory changes, pledges or encumbrances over shares;
- court records: active litigation, enforcement proceedings, interim measures, account freezes;
- taxes and contributions: standing with the Public Revenue Office, ongoing audits, unpaid liabilities of any kind;
- employment: number of employees, unpaid salaries and contributions, disputes with former employees;
- contracts: related-party agreements, long-term obligations, change-of-control clauses, loans and guarantees;
- property and permits: ownership and encumbrances over real estate, licences required for the business activity.
How is a share in a limited liability company transferred?
A share in a limited liability company (DOO) is transferred through a written share transfer agreement with signatures certified before a notary, and the change is registered with the Central Registry. Only upon registration does the change become visible to third parties. When the buyer is a foreigner, it is additionally checked whether the activity falls within the sectors for which the forthcoming screening regime for foreign direct investments would require notification of the transaction (more in FDI Screening in North Macedonia).
Which risks cannot be seen from the registers?
The most expensive surprises are precisely those recorded nowhere: verbal promises to former partners, potential tax penalties following a future audit, guarantees issued for third-party loans, undeclared employment, environmental liabilities. That is why the transfer agreement must not be a mere formality: typical protections include representations and warranties from the seller, retention of part of the price through an escrow account, price adjustment after a completed audit, and a termination right if the review uncovers a material problem.
| New company | Acquiring a share in an existing company | |
|---|---|---|
| Time to operations | a few days for registration, months for licences and first clients | immediately operational, continues existing business |
| History | clean, no obligations | the entire history is taken over with all obligations |
| Licences and contracts | obtained from scratch | usually already in place, but must be verified |
| Main risk | slow start and building a market position | hidden debts, guarantees and disputes |
What should an investor do before making an offer?
Before any advance payment or commitment, the sequence is simple and each step protects the buyer:
- a preliminary check of the company and the seller, before signing anything;
- a written confidentiality agreement before access to internal documentation;
- full legal due diligence, preferably with an auditor's review of the financials;
- a contract conditioned on the outcome of the review, with protective clauses and escrow;
- planning the payment structure and the tax treatment of the acquisition (more in Taxes for Foreign Investors in North Macedonia).
Acquiring a share in an existing company is the fastest route into the Macedonian market, but the price of speed is the risk of the unknown. A properly conducted review and a well-drafted agreement turn that risk into a calculable quantity, and that is work done before the signature, not after it.
Considering acquiring a share in a company in North Macedonia?
The value of the transaction depends on what the registers do not show. The review and the agreement are the difference between a well-bought company and an expensively bought problem.
We prepare complete legal due diligence on the target company, the share transfer agreement with protective clauses, and handle the proceedings before the registries and the notary.
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Source: Law on Trade Companies and data from the Agency for Foreign Investments and Export Promotion of the Republic of North Macedonia.
This text provides general legal information and does not constitute legal advice for a specific case. For advice tailored to your situation, please consult an attorney.