Related-party transactions (RPTs) require careful management in North Macedonia. The Company Law imposes strict obligations on interested parties — including managers, board members and significant shareholders — to disclose their interest and obtain prior company approval before any such transaction proceeds. An unapproved RPT is null and void and can expose the interested party to personal liability. This page is part of our practice in business and corporate law. For related questions about company governance, see our guide on compliance risks for managers in North Macedonia.

Related-party transactions (RPTs) occur when two parties with a pre-existing relationship engage in a business transaction. These transactions can occur between individuals, companies or subsidiaries of the same parent company.

Who Qualifies as an Interested Party?

The Company Law defines related-party transactions as transactions in which the related (interested) party is a manager, a member of a management or supervisory board, a shareholder holding more than 20% of the shares with voting rights, or any person who has the authority to give mandatory instructions in the company. Although the law specifically mentions loans, pledges and guarantees, in a broader sense, any transaction in which such a party has an interest falls within scope.

These persons have an obligation to inform the management of the company about all companies in which they alone or together with related persons hold 20% or more of the shares or voting rights, or hold any management function, for all current or future possible transactions in which they may appear as an interested party.

When Is an Interest Recognized?

An interest in a transaction is recognized if that person, their representative, or a person close to them (such as a spouse, parent, child or sibling) meets any of the following conditions:

• Is a party to the transaction, its beneficiary, representative or intermediary;
• Individually or jointly holds 20% or more of the shares in the company that is a party to the transaction, its beneficiary, representative or intermediary;
• Is a member of the management or supervisory board of the company that is a party to the transaction, its beneficiary or representative, or is a managing person of that legal entity; or
• Is determined to have an interest by the corporate acts of the company.

It should be noted that a related-party transaction does not arise if the company is founded and managed by a single person, or if all founders of the company have an interest in the relevant transaction.

Risks and Conflicts of Interest

Although related-party transactions are common in many industries, they can present significant risks. Without careful management, they can create conflicts of interest, disrupt financial performance and undermine the confidence of potential investors. Such transactions present a risk of self-representation of personal interests. For example, one company may transfer assets to another at an artificially low price, benefiting end-users in the other company but harming other investors of the parent company.

Prior Approval and Legal Consequences

According to the Company Law, any related-party transaction is subject to prior approval by the company, respecting the minimum number of votes determined by the law when adopting such decisions. Any related-party transaction conducted without approval or contrary to the law and the company’s corporate acts is null and void and can be annulled. The interested party can be held responsible for any damage caused.

The management of related-party transactions is crucial to protecting against conflicts of interest and promoting transparent financial reporting. By implementing appropriate internal policies, procedures and training programmes, companies can reduce the risks of these transactions and maintain trust with shareholders and the public.

Practical Checklist

For managers, board members and significant shareholders dealing with potential related-party transactions, verify the following: (1) Identify whether you are an interested party — check whether you, your representative or a close family member (spouse, parent, child, sibling) meets any of the four criteria under the Company Law. If in doubt, treat the transaction as a related-party transaction. (2) Disclose your interest to company management — if you hold 20% or more in any company involved in a current or future transaction, or hold a management role there, you must inform the company’s management before the transaction proceeds. (3) Do not proceed without prior approval — the transaction must be approved by the company with the minimum number of votes required by law before it is executed. An unapproved transaction is null and void. (4) Check the single-owner exception — if the company is founded by and managed by a single person, or all founders have an interest in the transaction, the RPT rules do not apply. (5) Implement internal policies — companies with complex ownership structures should have written RPT policies, disclosure procedures and approval workflows to reduce risk and maintain investor confidence. 

Frequently Asked Questions

Who is considered an interested party under the Macedonian Company Law?

An interested party includes: managers, members of management or supervisory boards, shareholders holding more than 20% of voting shares, and any person with authority to give mandatory instructions to the company. The interest can also be recognized through close family members (spouse, parents, children, siblings) who meet the same criteria.

What transactions are covered by the related-party transaction rules?

The Company Law specifically mentions loans, pledges and guarantees, but in a broader sense any transaction in which an interested party has a personal interest falls within scope. The determining factor is whether the party stands to benefit personally from the transaction in a way that could conflict with the company’s interests.

What happens if a related-party transaction is executed without approval?

A related-party transaction executed without the required prior company approval, or in violation of the law or the company’s corporate acts, is null and void. It can be annulled, and the interested party can be held personally liable for any damage caused to the company or other shareholders.

Is prior approval always required?

No — there are two exceptions. First, if the company is founded and managed by a single person (single-member company where the member is also the manager). Second, if all founders of the company have an interest in the relevant transaction. In both cases, the RPT approval rules do not apply.

How many votes are needed to approve a related-party transaction?

The Company Law specifies a minimum number of votes for approving related-party transactions, which must be respected when adopting the relevant decision. The precise threshold should be verified in the applicable version of the Company Law and the company’s own corporate acts, as the corporate acts may set a higher threshold.

Need legal guidance?

If you have questions about related-party transactions or corporate governance in North Macedonia, the team at Lalicic & Partners is at your disposal. Contact us through our website.