How Foreign Investors Exit North Macedonia – Share Sale, Asset Sale or Liquidation │ LB Law

What are the options for exiting a company in North Macedonia?

A foreign investor wishing to exit a company in North Macedonia will generally consider three principal options:

• Sale of ownership interest (share sale) – the investor sells its ownership interest in the Macedonian company;

• Asset sale – the Macedonian company sells its business or selected assets; or

• Voluntary liquidation – the company is wound down and deleted from the Trade Register.

These alternatives have significantly different consequences for tax, liability, timing and what ultimately transfers to a buyer or ceases to exist. The appropriate structure therefore depends on the circumstances of the investment, including whether a buyer exists, what the buyer wishes to acquire, the company’s historic liabilities, the investor’s tax position and whether the investor intends to terminate its Macedonian presence completely.

For foreign investors, choosing between these alternatives should therefore be treated as an exit-structuring decision rather than simply a decision to “sell or close” the company. Assumptions based on the investor’s home jurisdiction may not necessarily translate into Macedonian law.

This article compares the three main exit routes and is part of our practice in business and corporate law. For related M&A structuring questions, see our guide on mergers and acquisitions in North Macedonia.

1. Share Sale: Selling the Ownership Interest in the Macedonian Company

A share sale or, in the case of a Macedonian limited liability company (DOO), a transfer of a founding stake — is usually the natural starting point where a foreign investor has identified a buyer willing to acquire the existing Macedonian company.

The investor transfers its ownership interest to the buyer. The company itself, however, remains the same legal entity.

Its assets, contractual relationships, employees, licenses, receivables and liabilities therefore generally remain within the company following the ownership change.

How does a share sale work under Macedonian law?

For a DOO, which is the most commonly used corporate form in North Macedonia, the transfer of a founding stake is regulated by the Law on Trade Companies and the company’s own constitutive documents.

Under the Law on Trade Companies, members dispose of their stakes subject to the conditions prescribed by the company’s articles of association, and a stake may be transferred in whole or in part. The transfer is affected through an agreement for transfer of the stake certified by a notary. 

Where the stake is being transferred to a third party, statutory requirements concerning the transfer and rights of the existing members must also be considered. The company’s articles of association may additionally contain relevant restrictions or procedures.

Accordingly, before agreeing the transaction, the seller should review:

• the articles of association;
• any shareholders’ or members’ agreement;
• rights of first refusal or other transfer restrictions;
• whether the stake has been fully paid;
• corporate approvals required for the transaction; and
• the formalities for recording and registering the ownership change.

Following completion of the applicable formalities, the ownership change must be appropriately reflected in the company’s corporate records and registered with the Central Register.

For a joint-stock company (AD), a different regime applies and the transaction must be assessed in light of the rules governing shares, securities and the particular company’s constitutive documents.

What happens to the company after a share sale?

The important characteristic of a share sale is that the company itself is not being transferred asset by asset.

Only its ownership changes.

Consequently, the company’s property, contractual relationships, receivables, obligations and historic liabilities generally remain with the same legal entity.

This can make a share sale commercially attractive because the operating business can continue without separately transferring every individual asset.

However, the same feature creates risk for the buyer.

By acquiring the company, the buyer may indirectly become exposed to historic tax liabilities, litigation, employment claims, contractual obligations, regulatory issues, environmental liabilities and other matters existing within the acquired company.

For that reason, legal due diligence is normally a central part of a share acquisition.

For a detailed overview, see our guide to Legal Due Diligence in North Macedonia.

What protections will a buyer normally require?

Following due diligence, the transaction documentation normally allocates identified and unidentified risks between the parties.

Depending on the transaction, a share purchase agreement may therefore contain:

• representations and warranties;
• specific indemnities;
• limitations of liability;
• disclosure mechanisms;
• conditions precedent;
• purchase-price adjustment mechanisms;
• escrow or retention arrangements; and
• post-closing obligations.

For the foreign investor, the commercial question is therefore not only the price offered for the shares but also how much liability remains with the seller after completion.

A higher headline purchase price accompanied by extensive indemnities or weak limitations of liability may ultimately be less attractive than a properly structured transaction at a different price.

How is a foreign investor taxed on a share sale?

This issue requires particular care.

Where the seller is a foreign investor, the Macedonian tax treatment should be determined by reference to the status of the seller, Macedonian domestic tax legislation, the circumstances of the transaction and any applicable double taxation treaty.

For foreign corporate shareholders, the analysis should not simply proceed on the assumption that every capital gain from a disposal of a Macedonian company is automatically subject to a 10% Macedonian capital-gains tax.

Under the Macedonian corporate income tax framework, resident companies are subject to corporate income tax, while a foreign legal entity is generally subject to Macedonian corporate income tax in respect of profits attributable to its permanent establishment in North Macedonia. The general corporate income tax rate is 10%. 

The statutory withholding-tax regime applicable to specified payments to foreign legal entities includes, among other categories, dividends, interest, royalties and certain service income. The standard withholding rate for the listed categories is 10%, subject to an applicable double taxation treaty (“DTT”). 

Accordingly, the tax position of a foreign corporate seller disposing of an ownership interest should be established for the particular transaction rather than described simply as an automatic 10% capital-gains charge.

Where the foreign investor is a natural person, separate personal-income-tax rules apply, including rules concerning capital gains from participation in capital. 

The distinction between an individual investor and a corporate investor is therefore important.

Why should the applicable DTT be checked before signing?

North Macedonia has concluded double taxation treaties with numerous jurisdictions.

Depending on the particular treaty, the nature of the assets held by the Macedonian company and the circumstances of the transaction, the treaty may affect which contracting state has taxing rights over the relevant income or capital gain.

Treaty protection should not be assumed automatically.

The applicable treaty should therefore be reviewed before the purchase price and transaction structure become fixed, together with any procedural requirements for claiming treaty treatment.

2. Asset Sale: Selling the Business Rather Than the Company

An asset sale is fundamentally different from a share sale.

The foreign shareholder does not sell its ownership interest.

Instead, the Macedonian company itself sells specified assets, rights or parts of its business to the buyer.

The selling company therefore remains owned by the foreign investor after completion and ordinarily receives the sale proceeds itself.

Depending on the transaction, the assets being sold may include:

• real estate;
• equipment and machinery;
• inventory;
• intellectual property;
• receivables;
• contractual rights;
• business operations; or
• a combination of these elements.

When should a foreign investor consider an asset sale?

An asset sale may be appropriate where the buyer wants the business or selected assets but does not want to acquire the Macedonian company itself.

For example, a buyer may be interested in the company’s production facility, equipment, customer relationships and intellectual property but may be unwilling to assume the risk associated with the company’s complete historic liability profile.

An asset transaction can therefore give the parties greater control over the transaction perimeter — in other words, precisely what is and is not being acquired.

It may also be suitable where the parties can agree on the value of particular business assets but cannot reach agreement on the value or risk profile of the company as a whole.

What needs to be transferred separately in an asset sale?

Unlike a share sale, an asset transaction generally requires each category of asset or right to be analyzed individually.

The applicable transfer formalities depend on the nature of the asset.

Real estate transactions, for example, require compliance with the applicable formal requirements and registration of the ownership change with the Real Estate Cadaster.

Registered intellectual property rights may require separate documentation and registration with the competent authority.

Contracts also require individual review.

A contract cannot necessarily be assumed to transfer merely because the business to which it relates has been sold. Assignment restrictions, requirements for counterparty consent, termination rights and other contractual provisions must therefore be identified during due diligence and transaction preparation.

Regulatory licenses and permits require similar attention. Some authorizations may be connected to the particular legal entity holding them and may not simply be transferable to a buyer.

This is one reason why an asset transaction can be considerably more administratively complex than a share transaction.

What happens to employees in an asset sale?

Employment consequences should be analyzed according to the precise structure of the transaction.

Macedonian labor legislation contains protections relevant to transfers or status changes resulting in a change of employer, and the applicable treatment depends on whether the particular transaction constitutes a transfer falling within those rules. 

Accordingly, neither the seller nor the buyer should assume that employees can simply be included or excluded from an asset transaction without a separate labor-law analysis.

The employment structure should be reviewed before completion, including the consequences for existing employment relationships, accrued rights, collective arrangements where applicable and any obligations toward affected employees.

How is an asset sale taxed in North Macedonia?

An important difference from a share sale is that the seller of the assets is the Macedonian company itself.

Macedonian resident companies are subject to corporate income tax at a general rate of 10% on their taxable profit. Capital gains realized by a corporate taxpayer are generally treated as ordinary income and included in the corporate tax base. 

The sale of assets may therefore generate taxable profit at company level.

VAT must also be considered separately depending on the nature of the transaction and the particular assets involved. The standard Macedonian VAT rate is currently 18%, although the actual VAT treatment depends on the transaction. 

Where real estate is involved, applicable property and real-estate transfer taxation must also be examined.

What happens when the foreign investor wants to extract the sale proceeds?

This is one of the most important practical differences between a share sale and an asset sale.

Following a share sale, the purchase price is normally received directly by the selling shareholder.

Following an asset sale, however, the purchase price is received by the Macedonian company.

If the foreign investor subsequently wants to extract those funds, an additional transaction is required — for example, a dividend distribution or, depending on the wider exit plan, a distribution during a subsequent liquidation.

Dividends paid by a Macedonian company to a foreign legal entity are generally subject to a 10% withholding tax under domestic legislation, unless an applicable double taxation treaty (“DTT”) provides a lower rate or exemption. 

Consequently, the economic result of an asset sale should not be assessed solely by looking at corporate income tax arising from the sale.

The investor should consider the complete route from sale of the assets to receipt of the proceeds by the foreign shareholder.

This can materially affect the comparison between a share sale and an asset sale.

3. Voluntary Liquidation: Closing the Macedonian Company

Voluntary liquidation is not a sale.

It is the legal process through which a company winds down its activities, settles its obligations, deals with its remaining property and is ultimately deleted from the Trade Register.

It may therefore be appropriate where the foreign investor does not intend to sell the business and simply wishes to terminate its Macedonian presence.

For a more detailed explanation of the procedure, see our guide to Company Liquidation in North Macedonia.

When is voluntary liquidation appropriate?

The fundamental distinction is between a company that is solvent and one that satisfies the statutory conditions requiring insolvency or bankruptcy proceedings.

Voluntary liquidation is intended as an orderly winding-down procedure for a company capable of addressing its obligations.

It should therefore not be treated as an alternative method for avoiding bankruptcy where the statutory conditions for insolvency proceedings exist.

For a solvent company, the liquidation process generally includes:

• adoption of the necessary corporate decision;
• appointment and registration of a liquidator;
• notification and protection of creditors;
• settlement of outstanding obligations;
• completion of relevant tax and administrative matters;
• distribution of the remaining property in accordance with the applicable rules; and
• deletion of the company from the Trade Register following completion of the procedure.

Where particular assets remain at the end of the process, the applicable rules for their distribution and transfer must also be considered. The Central Securities Depository, for example, expressly provides procedures for transferring securities remaining in a voluntary liquidation to shareholders following the relevant liquidation and deletion decisions. 

What are the tax consequences of liquidation?

The tax consequences should be analyzed at both company and shareholder level.

The company must address its tax position as part of the winding-down process.

Where assets or funds remain for distribution to a foreign shareholder, the nature and tax treatment of the relevant distribution must then be determined under Macedonian domestic tax law and any applicable DTT.

This should be established as part of the liquidation planning rather than assuming that every liquidation distribution receives the same tax treatment as an ordinary dividend.

4. Which Exit Route Should a Foreign Investor Choose?

There is no single exit structure that is preferable in every case.

Where a buyer wants the existing operating company

A share sale will normally be the natural starting point.

The legal entity continues to operate and its business relationships and assets remain within the same company.

The buyer, however, will normally conduct due diligence and seek contractual protection against historic liabilities.

Where the buyer wants the business but not the company

An asset sale may be preferable.

The buyer can potentially define the assets and operations it wants to acquire without acquiring the company’s entire historic liability profile.

The disadvantage is that individual assets, contracts, employees, licenses and other rights may require separate treatment, making the transaction more complex.

Where there is no buyer

If the investor simply wants to discontinue the Macedonian operation and the company is solvent, voluntary liquidation may be the appropriate route.

The company settles its affairs and is ultimately deleted from the Trade Register.

Where tax is important to the transaction economics

The structures should be compared before one is selected.

A direct sale of the ownership interest by the foreign shareholder and an asset sale by the Macedonian company are different transactions.

An asset sale can result in taxation at company level and may then require a further distribution to move the proceeds from the Macedonian company to its foreign shareholder.

The investor’s jurisdiction of residence and the applicable DTT can therefore materially affect the result.

5. A Practical Point from Our Transaction Work

Foreign investors sometimes approach an exit as a corporate-formality question: first deciding to sell the shares or assets and only afterwards examining tax, liabilities and transaction structure.

In practice, the sequence should generally be reversed.

Before committing to a particular exit structure, the investor should identify:

• the applicable DTT position;
• material historic and contingent liabilities;
• key commercial contracts;
• financing arrangements and security;
• employees and employment liabilities;
• licenses and regulatory approvals;
• real estate and other significant assets;
• existing disputes or potential claims; and
• how the investor ultimately intends to receive the transaction proceeds.

This analysis can affect not only the legal documentation but also the commercial value of the transaction itself.

Once a letter of intent, term sheet or purchase price has been agreed on the basis of a particular structure, changing that structure can become considerably more difficult.

Early exit planning therefore gives the investor greater flexibility.

6. Share Sale vs Asset Sale vs Liquidation 

7. Practical Takeaway

For a foreign investor, the important question is not simply:

“How do I sell or close my company in North Macedonia?”

The more useful question is:

“Which exit structure gives me the appropriate legal, tax and commercial result?”

A share sale can be the most straightforward route where a buyer wants the existing operating company. However, the buyer will ordinarily investigate the company’s historic liabilities and seek appropriate contractual protection.

An asset sale gives the parties greater control over what is being acquired and can allow the buyer to avoid acquiring the company itself. However, the transaction can require separate treatment of assets, contracts, employees, licenses and other rights, and the proceeds initially remain within the Macedonian company.

A voluntary liquidation can provide an orderly route for terminating a solvent company where no business sale is contemplated, but all statutory, creditor and tax requirements must first be completed.

The appropriate structure ultimately depends on the company, the investor, the proposed buyer, the nature of the assets and liabilities, the applicable DTT and the investor’s commercial objectives.

For this reason, exit planning should ideally begin before a buyer is identified or a term sheet is signed.

At that stage, the transaction can still be structured around the investor’s objectives rather than merely documenting a structure that has already been commercially agreed.

Are You Considering an Exit from a Macedonian Company?

Lalicic & Partners advises foreign investors on the acquisition, sale, restructuring and closure of companies and businesses in North Macedonia.

Depending on the transaction, our assistance includes:

• transaction and exit structuring;
• legal due diligence;
• share and asset purchase agreements;
• corporate approvals and closing documentation;
• regulatory and corporate registrations;
• coordination of tax considerations with the transaction structure; and
• post-closing and liquidation procedures.

If you are considering selling, restructuring or closing a business in North Macedonia, contact us to discuss the appropriate exit structure before the commercial terms are finalized.

Last updated: August 2026

Note: The above does not constitute legal advice and in no way can be accepted or understood as an instruction to act in a specific case. Each legal situation has its own characteristics that should be reviewed at separately, and for that reason we recommend that you contact a professional – a lawyer – for legal advice.