NACE codes: choosing business activities

When you register a business with ARBK, you have to say what it will do. You don't describe that in your own words. You pick NACE codes, a standard European classification of economic activities. It looks like a formality, but it affects licences, taxes and how customers find you.

What a NACE code is#

NACE is the classification of economic activities used across the EU, and Kosovo uses the NACE Rev. 2 version. Every code has levels, from a broad section down to a narrow class:

• Section I: Accommodation and food service activities
  • 56: Food and beverage service activities
    • 56.10: Restaurants and mobile food service activities

When registering, pick codes at the most detailed level the ARBK form offers.

Primary and secondary activities#

• The primary activity is where most of your revenue comes from. There is only one.
• Secondary activities are everything else you do. A bakery (10.71) that also runs a café can register the café (56.30) as secondary.

The primary activity carries more weight: statistics, some sector rules and the categories you appear in depend on it. On Kerko, for instance, a business appears in categories like Food & hospitality or Technology based on its registered activities.

How many activities to register#

It's tempting to register twenty activities "just in case". That usually doesn't help:

• Some activities need a licence or permit. If you register them, someone may ask where the licence is. See Business licences and permits.
• Partners and banks read the list. A business that seems to do everything raises more questions than one with a clear focus.
• Your category gets blurry. Customers searching by activity find you more easily when the list is accurate.

A practical rule: register what you do now and what you realistically plan for the coming months. Add the rest when you need it.

Finding the right code#

1. Start from the product or service, not the industry name. "I sell phones in a shop" leads to retail (47.42), not telecommunications.
2. Separate wholesale from retail. Selling to other businesses (46.xx) and selling to consumers (47.xx) are different codes.
3. Separate making from selling. If you make furniture yourself, the code is under manufacturing (31.xx). If you buy it in and resell it, it's under trade.
4. See how similar businesses registered. Look up a few competitors on Kerko and check their codes.
5. Ask your accountant. They know which codes have tax consequences, e.g. for small-business regimes.

When the code affects taxes#

For small businesses, the law can set different rates by type of activity, e.g. trade or production versus professional services. So your primary activity can affect the rate you pay. Check the current rules with your accountant or ATK. More in NUI, fiscal number and VAT.

Changing activities#

You can add or remove activities, or change the primary one, by filing with ARBK. The process is covered in Changing business details at ARBK. If your business has changed direction, keep the registry up to date. It's what others see when they check you.