Guide to Company Incorporation in Serbia

1. What is the minimum share capital of a Serbian Limited Liability Company (d.o.o.)?

The minimum capital requirement for a Serbian Limited Liability Company is 500 EUR. Shares can be pecuniary contributions and any other kind, including work and services.

2. What is the minimum share capital for a Serbian Joint Stock Company (a.d.)?
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Serbian Joint Stock Companies require a 10.000 EUR initial capital which should be fully paid on the day of deposit by a closed joint stock company or 25000 EUR for an open joint stock company. There is also a requirement for the maximum number in case of a closed joint stock company, where the maximum number of shareholders cannot exceed 100.

3. Are there any special requirements for establishing a Serbian Limited Liability Company?

According to Serbian Law Limited Liability Companies can be set out by one or more legal or physical persons engaging in activities under business name. The maximum number of members of such a company is 50 so for the entities willing to have more members is indicated to choose the form of Joint Stock Company. There are no regulations as to the citizenship of the founders, nor does the director have to have certain nationality. However in some cases certain documentation of the director is needed in order to commence the registration process. Usually the process of company incorporation can be done by a representative of the future company provided he or she is authorized with power of attorney. Limited Liability Companies are required to have a registered address in Serbia. Any Serbian Company needs to open a bank account and therefore personal visit of the company's director may be requested by the chosen bank.

4. How can I register for VAT in Serbia?

For the entities earning more than 4 million RSD the registration for VAT is mandatory. The VAT standard rate in Serbia is 18% and can be reduced to 8% for certain services and goods.

In order to register for VAT the founders must file a form at the Serbian tax authorities along with documentation on the company such as extract of articles of association, address and other information. After the VAT number is issued by the Serbian tax authorities, companies can benefit from VAT refunds and deductions.

5. How can I open a bank account in Serbia?

It is mandatory for a Serbian company to have a bank account in which to carry out transactions. The founder is free to choose a bank that best suits the company's needs. The initial capital should be credited to the account while payment receipt serves as proof of payment when the company is registered. Choosing the most appropriate bank is important because some banks require the personal visit of the account's founder to ensure on his or her existence. However, most banks are satisfied in collaborating with a representative of the company. The following documents are usually required: an application completed by the company’s representative, the articles of association, the company’s registration certificate (in case the bank account is opened after registration).

6. How can I recruit personnel in Serbia?

A brand new company that is looking to hire employees has a lot of alternatives to choose from. Serbian recruitment agencies offer focused attention and select the most appropriate candidates for the company's needs. Also there are plenty websites that offer the possibility for a company to create an account and post job offerings, while choosing the best applicants.

7. What is the average salary in Serbia?

The average salary of Serbian workers is around 500 EUR.

8. What is the overall economic situation in Serbia?

The economy of Serbia is based on services, industry  and agriculture. Even though the country has a history of economic problems, liberalization process established in the last decade has increased the economic development of the country. However the main problems remain the high unemployment rate and trade deficit. In the last few years the government of Serbia has taken measures to attract foreign investment by offering various incentives for investors, such as preferential loans, tax deductions etc. 

The main Serbian economic problem is the slow growth, with only 2 % in 2011 and 1% in 2010. In fact the growth of the economy was even smaller than it was in 2009 when it consisted in 3.5% but this is mostly due to the economic crisis from which all the European countries has suffered.

In September 2011 Serbia has signed a new $1.3 billion Precautionary Stand By Arrangement with the IMF but the program was frozen in early 2012 because the 2012 budget didn’t fit the from the program parameters. 

The government is struggling to resolve these issues. Serbia has signed Free Trade Agreement with the EU managing to export its products without customs and other fees. Also has signed the CEFTA, this way managing to provide goods without customs or various fees to Bosnia and Herzegovina, Albania, Moldova, Croatia or Macedonia and FTA with Russia, Norway, Switzerland, Iceland and Liechtenstein for a restricted list of items.