Starting a business in Serbia involves navigating a well-regulated legal system designed to attract both domestic and international entrepreneurs. The process is relatively efficient, but understanding the legal framework and obligations is crucial for a compliant and successful launch. This article offers a legal overview of registering a company in Serbia, detailing entity types, registration procedures, required documentation, and key compliance issues.
Choosing the Right Legal Entity
One of the first and most important legal steps in establishing a business in Serbia is selecting the proper legal structure. The most commonly used forms under Serbian law include:
- Limited Liability Company (DOO): This is the most popular structure, ideal for small to medium businesses. It can be established by one or more individuals or legal entities and requires minimal share capital (RSD 100). Shareholders’ liability is limited to their capital contribution.
- Joint Stock Company (AD): Designed for larger businesses or companies planning to be publicly traded. It can be either private or public, with a minimum founding capital of RSD 3 million (private) or RSD 10 million (public).
- Entrepreneur (Preduzetnik): A sole trader operating under their own name. While easy to set up, this format involves unlimited personal liability, making it riskier than incorporated forms.
- General Partnership (OD) and Limited Partnership (KD): These involve two or more persons operating under a partnership agreement. Liability in a general partnership is joint and unlimited, while a limited partnership includes both general and limited partners.
- Branch or Representative Office: These are options for foreign companies that want to operate in Serbia without forming a separate legal entity. A branch can conduct commercial activities, while a representative office is limited to non-commercial tasks.
Legal Steps to Register a Company
Company registration in Serbia is handled by the Business Registers Agency (APR). The entire process is governed by the Law on Companies and can usually be completed within a few days if all documentation is in order.
Step 1: Name Availability and Reservation
The desired company name must be unique and conform to legal naming rules. Entrepreneurs must check availability through the APR and reserve the name before proceeding.
Step 2: Prepare Incorporation Documents
Depending on the legal form, required documents may include:
- The Founding Act or Articles of Association
- Decision on appointing a director or managing body
- Identification documents of founders and directors
- Address of the company’s registered seat
- Proof of the right to use the business premises
For foreign founders, notarized and translated identification or company documents are necessary.
Step 3: File the Application with APR
An application must be submitted to the APR along with supporting documents and the registration fee (around RSD 4,900 for DOOs). This can be done in person or electronically via the APR’s online system.
Step 4: Tax and Statistics Registration
After successful registration, the company is automatically issued a tax identification number (PIB) and registered with the Statistical Office. If applicable, the company must also register for VAT with the Tax Administration.
Step 5: Open a Business Bank Account
With the registration and PIB, the company can open a corporate bank account in a Serbian bank. Banks may request additional information about the business, especially for foreign-owned entities.
Ongoing Legal Compliance
Registering a business is just the beginning. Serbian law imposes several ongoing legal responsibilities on companies, including:
- Accounting and Reporting: All companies must maintain financial records and submit annual financial statements to the APR. Medium and large businesses must undergo audits.
- Tax Obligations: Corporate income tax in Serbia is 15%. Companies must comply with VAT (20%) and other taxes, depending on their business activities.
- Labour Law Compliance: Hiring employees requires employment contracts that meet the Serbian Labour Law standards. Employers must register workers with social insurance authorities.
- Corporate Governance: Limited liability and joint stock companies must keep proper internal records, hold meetings of members/shareholders, and report any statutory changes to the APR.
- AML and Data Protection: Companies operating in sectors such as finance or real estate must follow Anti-Money Laundering (AML) laws. The Law on Personal Data Protection, aligned with GDPR, also applies.
Foreign Investment and Legal Protections
Serbia imposes no restrictions on foreign ownership of companies, allowing 100% foreign equity in most sectors. Investors benefit from legal protections provided under bilateral investment treaties and access to arbitration in the event of disputes.
However, some sectors like defence, energy, or real estate near the borders are regulated and may require special approval. It’s advisable to consult local legal experts before investing in these industries.
Conclusion
Registering a company in Serbia is a structured and transparent legal process. While the procedures are straightforward, compliance with legal requirements—from documentation and registration to tax and labor laws—is critical. Whether you’re a local entrepreneur or a foreign investor, understanding the Serbian legal environment is essential for building a sustainable business. Partnering with a legal advisor can help you navigate the process confidently and avoid costly errors.