A Joint Stock Company is a company whose share capital is divided into shares that have one or more shareholders who are not responsible for the company’s liabilities. Consequently, a Joint Stock Company is responsible for its liabilities with all its assets. Beside this general information there are many other that are important and have to be taken into account when we are answering on the question how to register a Joint Stock Company in Serbia.

What documents are needed to complete this procedure?

List of documents that are needed to complete this procedure is quite long one. Therefore, here we will just mention them, and we will not go through every document. Having said that, the list of needed documents is as follows:

1. Registration Application for the establishment of legal entities and other entities and entry in the unique register of taxpayers – joint stock company,
2. Founding Act of the Company with certified signatures of members of the Company,
3. Memorandum of Association of the Company signed by the members of the Company,
4. Credit Institution’s Confirmation of the paid-in shares in cash, or the valuation of an authorized non-cash value appraiser or a certificate from the competent authority of the non-cash value assessment in accordance with the law,
5. Several different Decisions, for all facts not stipulated by the Founding Act,
6. Proof of payment of the state fee.

Shareholders who are founding a Joint Stock Company must sign the Founding Act, and their signatures are certified in accordance with the law governing the certification of signatures before the Public Notary. The founding shareholders also sign the first Memorandum of Association.

What is the minimum share capital of a Joint Stock Company in Serbia?

Subscribed shares that are paid in cash in accordance with the founding act shall be paid prior to the registration of the establishment in a temporary account with a commercial bank in the Republic of Serbia. Prior to the registration of the company, the shareholders who set up the company are obliged to pay or deposit deposits representing at least 25% of the share capital, whereby the paid-up amount of the cash part of the share capital may not be lower than the amount of the minimum share capital amounting to 3.000.000,00 RSD ( around 25.500,00 EUR).

What does the Memorandum of Association have to stipulate?

The Memorandum of Association of a Joint Stock Company contain in particular:

1. Business name and registered office of the company,
2. Predominant activity of the company,
3. Information on the amount of subscribed and paid-up share capital, as well as data on the number and total nominal value of authorized shares, if any,
4. Essential elements of the issued shares of each type and class in accordance with the law governing the capital market, and in the case of shares that do not have the nominal value and the amount of the share capital for which they have been issued, or accounting value, including any obligations, restrictions and privileges related to each class of actions,
5. Types and classes of actions,
6. Special conditions for the transfer of shares,
7. The procedure for convening a General Assembly,
8. Determining the organs of the company and their scope, the number of their members, regulating in more detail the manner of appointment and recall of these members, as well as the decision-making methods of those bodies.
9. Other information in accordance with the Company Law or other competent Law.

If you need any additional information on how to register a Joint-Stock Company in Serbia, or you wish to know more on this topic in general, feel free to contact our team.

While certain categorizes and nationals of countries do not need visa to enter Schengen Area, others that are not privileged need to go through all the processes of meeting requirements and attending interviews in order to obtain this Visa. But, before we go through list of countries whose citizens need a Visa, we will explain what Schengen Area is.

What is Schengen Area?

It is the world’s largest visa free zone of 26 European countries that abolished their internal borders. by doing so these countries enabled free and unrestricted movement of people. This Area covers most of the European Union (EU) countries, with the exception of UK, Ireland and countries that are in process of becoming a part of: Romania, Bulgaria, Croatia and Cyprus.

What are Member States of the Area?

The above 26 stated European countries that are part of Schengen Area are: Austria, Belgium, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Iceland, Italy, Latvia, Liechtenstein, Lithuania, Luxembourg, Malta, Netherlands, Norway, Poland, Portugal, Slovakia, Slovenia, Spain, Sweden, and Switzerland.

What is Schengen Visa?

The Schengen Visa is the most common visa for Europe and represents a short-stay visa that allows a person to travel to any Member state, per stays up to 90 days for tourism or business purposes. It is important to know that if you want to study, work or live in on of the Member states for more than 90 days, then you will have to apply for a national visa of that country and not for Schengen Visa.

Who Needs a Schengen Visa?

Simply said, all nationals of third countries, that are not part of Schengen Area, and that did not reach a visa-liberalization agreement with the Member states, need to obtain a visa prior of their arrival in Europe.

Are there different types of Schengen Visa?

Yes, there are. If you are not citizens of a member state, you will have to apply for the Visa for the following reasons:

• Business purposes;
• Visiting friends and family;
• Tourism and holidays;
• Cultural and sport events;
• Airport transit and transit for seafarers;
• Official visit;
• Medical reasons;
• Short-term study and research purposes.

Also, depending on the reasons and the frequency of your visit to Member states you can be granted with single-entry visa, double-entry visa, or a multiple-entry visa.

Citizens of Which Countries Don’t Need a Schengen Visa to enter Europe?

Among many countries that do not need a visa to enter the Area such as Canada, Japan, Monaco, New Zealand, Singapore, visa-free regime applies to citizens of Albania, Bosnia and Herzegovina, North Macedonia, Moldova, Montenegro and Serbia only if they are holders of biometric passport. For holders of the passports issued by Taiwan this visa-free regime applies only if their passport contains an identity card number.

Additionally, visa-free regime applies to holders of a Hong Kong Special Administrative Region passport and holders of Região Administrativa Especial de Macau passport.

Citizens of the countries that don’t need a visa to enter the Area are permitted to stay in any of the Schengen zone countries up to 90 days every half a year, regardless of the travel reasons.

If you need any additional information regarding Schengen Area or Visa, feel free to contact Asst Office.

When registering a business, especially when registering Limited Liability Company or Joint Stock Company, the share capital is one of the most important parts of the process. This is also true when we talk about the share capital of the Serbian company. Due to complexity here we will resent basic information regarding share capital for Serbian Limited Liability Company.

What is minimum share capital for Limited Liability Company in Serbia?

The minimum share capital of a company is at least 100,00 RSD (around 0.87 EUR), unless a special law provides for a larger amount of share capital for companies performing certain activities. The members of the company are obliged to pay the registered founding capital within 5 years from the date of registration of the Founding Act. This means that you can register a company without previously paying share capital.

How can share capital be increased?

There are 5 different grounds on which the share capital of the Serbian Company can be increased:

• new contributions of existing members or members joining the company;
• converting reserves or profit of the company into share capital;
• converting of claims from the company into share capital;
• status changes that result in an increase in share capital;
• conversion of additional payments into share capital.

How can share capital of the Serbian Company be decreased?

The share capital of a limited liability company may be reduced, but not below the minimum share capital in following situations:

• to cover losses of the company;
• to create or increase the Company’s reserves to cover future losses or to increase its share capital from the Company’s net assets;
• in the cases referred to in Article 46, paragraph 3 and Art. 155 (withdrawal and cancellation of shares) and 159 (disposing of own share) of Company Law;
• in case of cancellation of the reserved own share.

The share capital of a company is considered to be a decreased on the day of registration in the Register of Business Entities.

What documents you need to submit depend on the legal ground on which share capital is being increased or decreased.

If you want to know more about how to increase or decrease share capital in Serbian company, what documents are needed to complete company formation process, what are state fees and how long procedures last, contact Asst Office and we will provide you with all necessary information.

Working time in Serbia is defined as the period of time during which the employee is obliged, i.e. available to perform tasks according to the orders of the employer, at the place where the work is to be performed. It is also possible that the employee and the employer agree that one period of working time within the agreed working hours shall be performed by the employee from home.

What types of employment there are in Serbia?

There are two types of employment in Serbia: full time and part time. The standard for full time employment is 40 hours per week, as stipulated by Labour Law. Employer can determine by General Act that full time work is shorter than 40 hours, but not shorter than 36 hours per week. Employee that works shorter than 40 hours per week still has all employments right as if he is working 40 hours per week.

On the other side, part time employment is referred as working shorter than stated 40 hours, or in mentioned situations 36 hours, per week.

Additionally, employee who works in particularly difficult, arduous and unhealthy jobs, that are determined by Law or General Act, on which despite the implementation of appropriate safety and health measures, personal protective equipment and or other equipment has an increased adverse effect on health of the employee – shortening of working time is proportional to the adverse effect of working conditions on the health and working capacity of the employee, and up to a maximum of 10 hours per week (jobs with increased risk).

Working time schedule and redistribution of working hours

As a rule, a working week lasts five working days, where one working day last for 8 hours. The employer with whom the work is performed in shifts, at night or when the nature of the work and the organization of work requires it – can organize the working week and working hours in another way.

The employer may redistribute working hours when required by the nature of the business, the organization of work, better use of means of work, the more rational use of working time and the execution of certain work within the set deadlines. It is important to know that redistribution of working time is not considered as overtime.

Night work and work in shifts

Work performed between 10 pm and 6 am the following day is considered night work. For an employee who works at night for at least three hours each working day or one third full-time during one working week, employer shall be obliged to ensure that work is carried out during the day if, in the opinion of the competent health authority, such work would lead to a deterioration of his health condition.

Shift work is the organization of work with an employer according to which employees in the same jobs are shifted according to a fixed schedule, whereby shift shifts can be continuous or intermittent for a specified period of days or weeks.

All of this is stipulated by Labour Contract between employer and employee. That is why you should make sure that you do everything in accordance with Labour Law, and check with legal consultant all aspects of Contract with employees.

The Serbian government has invested around $79 million in technical infrastructure to nurture start-ups, including initiatives like free work spaces and a focus on tech in universities. This, as well as the fact that export of ICT services of Serbia is worth more than 1.4 billion EUR and that it represents nearly 15% of Serbian GDP, shows that there are many reasons to incorporate an IT company in Serbia. Here we will mention just few of them.

1. Well educated and skilled employees

To begin, it is important to say that at every state University there is Faculty of Technical Sciences, where those from University of Novi Sad and Belgrade are ranked at Shanghai Ranking Lists. Beside knowledge of numerous programming languages, Serbian programmers are quite fluent in English. Also, it is not that uncommon that some of them speak third language, as well. Also, the fact that Serbia is ranked in top 5 countries in the world when it comes to Global Ecosystem for Affordable Talents and Activation Ecosystem for Blockchain. In addition to all of this, Novi Sad is considered to be capitol of IT sector in this region.

2. Favourable Taxes

To be honest, apart from having skilled employees, tax regime represents one of the most important parts when expending business to new market. Serbia has low corporate income tax rate for Tech start-ups. These start-ups enjoy stimulative Research and Development deduction and intellectual property box regime, also known as innovation box or IP box, tax regime rated at 3%. This means that star-ups pay very little for corporate income tax.

3. Developed Market

We firmly believe that if there is healthy competition everyone can benefit from that. Therefore, that Serbian has really developed IT market says a lot about opportunities that this country offers. We already mentioned skilled workforce and favourable taxes, being most important, but fact that many companies already have a strong presence at Serbian market tells a story of success of IT sector in Serbia.

4. Price / quality ratio

Maybe you already read that price of work is low in Serbia, and that prices in general are lower than in other countries in Europe. But what is more important is what you will get for your money. Beside affordable yet highly skilled workforce that you will most certainly find in Serbia, you will also find great office spaces and excellent infrastructure at lower price than in other countries in the region.

5. Future of IT in Serbia

As stated above, Serbian government is doing everything in their power to assure bright future for IT companies in Serbia. In order to secure constant influx of IT experts, computer science and informatics are as a compulsory subject in primary schools. Secondly, number of specialized IT departments in high schools is growing rapidly. Finals step is reform of higher education in the area of IT and expanding the educational capacity of future top experts in this field.

These would be 5 main reasons to incorporate an IT company in Serbia. In case that you have questions about how to register a company in Serbia, employment and labour law in Serbia and tax regime, contact our tax, legal and HR experts.

Employment in Serbia is regulated by the Labour Law. While you have freedom to decide what tasks to assign to your employees, it would be useful to get familiar with the most important aspects of the Labour Law.

To make sure that your company is compliant with regulations it is recommended that you consult with your accountant or an HR advisor.

What does Serbian Labour Law define?

Serbian Labour Law defines most important aspects of employment. It stipulates all the rights and obligations of an employment relationship, such as conditions for employment, Labour Contract, working hours, holidays and leave, protection of employees, etc.

What are general employee obligations?

In general employee is obliged to:

• to conscientiously and responsibly carry out the tasks on which he works;
• to respect the organization of work and business with the employer, as well as the conditions and rules of the employer in relation to the fulfilment of contractual and other obligations arising from employment;
• to inform the employer of significant circumstances that affect or could affect the performance of the tasks specified in the employment contract;
• to inform the employer of any type of potential danger to life and health and the occurrence of material damage.

What are general employers’ obligations?

The same way Labour Law stipulates general responsibilities of an employee it stipulates the responsibilities of an employer. Therefore, employer is obliged to pay the employee for the work performed, in accordance with the law, general act and employment contract and provide the employee with working conditions and organize work for the safety and protection of life and health at work, in accordance with the law and other regulations.

Additionally, employer is obliged to provide the employee with information on working conditions, organization of work and the rights and obligations arising from labour regulations and regulations on safety and health and safety at work, as well as to provide the employee with conditions to perform the tasks specified in the employments contract.

Finally, it is employer’s obligation to request the opinion of the Union in cases stipulated by law, and if the Union has not formed from the representatives appointed by the employees.

What does Labour Contract govern?

First of all, it is necessary to state that employment is based on a Labour Contract. While it may not contain provisions granting the employee less rights or establishing less favourable working conditions than the rights and conditions established by Labour Law, Labour Contract must contain following provision:

• name and seat of employer;
• personal name of the employee, place of permanent or temporary residence of the employee;
• the type and degree of professional qualification, i.e. education of the employee, which are a prerequisite for performing the activities for which the Labour Contract is concluded;
• the name and description of the tasks that the employee should perform;
• place of work;
• the type of employment (for an indefinite or fixed term);
• the duration of the fixed-term employment contract and the basis for the fixed-term Labour Contract;
• day of commencement of work;
• working hours (full, part-time or short time);
• the amount of basic salary at the date of conclusion of the Labour Contract;
• elements for determining basic salary, performance, remuneration, increased earnings and other employee benefits;
• deadlines for payment of earnings and other benefits to which the employee is entitled;
• duration of daily and weekly working hours.

If an HR expert assists you already during recruitment, you can rest assured that all the relevant aspects of the Serbian Labour Law will be considered while formulating the position and drawing up the Labour Contract. This ensures that hiring a new employee will be the beginning of a beautiful employment relationship.

There are two types of public holidays in Serbia: national holidays and religious holidays. Some of them are non-working public holidays, while others are working public holidays.

Non-working public holidays in Serbia for 2020

The national holiday of the Republic of Serbia is Sretenje – National Day of Serbia, commemorating the day when the First Serbian Uprising was erected at the assembly in Orašac in 1804 and the day when the First Constitution of the Principality of Serbia was issued and sworn in 1835.

• Sretnje – Serbian National Day is celebrated on February 15th-17th.

The national holidays of the Republic of Serbia are also:

• New Year’s Day (January 1st and 2nd);
• Labour Day (May 1st and 2nd); and
• Peace Day in the First World War (November 11th).

Religious holidays are celebrated in the Republic of Serbia:

• The first day of Christmas (January 7th);
• Easter holidays beginning on Good Friday and ending with the second day of Easter (17th-20th April).

On the days of national and religious holidays celebrated in the Republic of Serbia, state and other bodies, companies and other forms of organization for performing activities or services do not work, except on the Victory Day, which is celebrated on working days.

State and other bodies, companies and other forms of organization for performing activities or services are obliged to ensure the continuous performance of activities, i.e. services, even on the days of national and religious holidays that are celebrated in the Republic of Serbia, if the discontinuation of activities or services would cause harmful consequences for citizens and the state.

Businesses and other forms of organizing for the performance of activities or services whose nature of activity, that is, the technology of the work process requires continuous work, may also work on the days of national and religious holidays celebrated in the Republic of Serbia.

Additionally, employees have the right not to work on the following religious holidays:

• Orthodox – on the first day of baptismal glory;
• Catholics and members of other Christian religious communities – on the first day of Christmas and on the Easter holidays, beginning on Good Friday, ending with the second day of Easter, according to their calendar;
• Members of the Islamic community – on the first day of the Ramadan Bayram and the first day of the Kurban Bayram;
• Members of the Jewish community – on the first day of Jom Kippur.

Working public holidays in Serbia for 2020

The Republic of Serbia celebrates:

• St. Sava’s Day – Spirituality Day (January 27th);
• Day of Remembrance for Holocaust Victims, Genocide and Other Victims of Fascism in World War II (April 22nd);
• Victory Day (May 9th)
• Vidovdan – Memorial to the Battle of Kosovo (June 28th);
• Day of Remembrance for Serbian Victims in World War II – Memorial to 21st October 1941 and the bloody autumn of 1941 when the German occupying forces carried out a mass war crime against civilians in Kragujevac and throughout Serbia.

For all your business activities in Serbia, feel free to contact Asst Office and appoint a meeting with our team.

Work, in addition to employment, includes the representation of a company on the basis of entry in the register of Serbian Business Register Agency, as well as the performance of management powers and management tasks in accordance with the law governing the status of companies. There many situations where contribution for legal representatives of Serbian company must be paid, and these are just few of them.

FOREIGN CITIZENS who are the Founders of a company

Foreign citizen – natural person – who is not a resident of the Republic of Serbia, can be a Founder and / or a Member of a company in Serbia. Which regulations will apply to the determination and payment of compulsory social security contributions for the Founder and / or a Member of a company depends on the circumstances of whether a contract has been concluded with the state of residence of Founder and/ or Member in the field of social security.

If a bilateral agreement is concluded, there is no obligation for that person to pay social security contributions under the regulations of the Republic of Serbia if two cumulative conditions are met:

1. If the natural person submits a certificate that s/he is a resident of the country with which the social security contract has been signed, certified by the competent authority of that state, and
2. If the natural person submits a certificate that s/he is compulsorily insured in the State of residence (Contracting State), certified by the competent authority of that State.

Failure to provide the above evidence, as well as in the case where no bilateral social security contract is concluded, the regulations of the Republic of Serbia in the field of compulsory social security shall apply.

Founders who do NOT work in their company and are NOT registered to represent the company but are in a working relationship in their company regarding jobs that are not representation

Founder or a Member of a company who is employed by his company is obligatory insured on the basis of employment as an employee. This person may perform any business activity in that company, as well as any other employee, except to represent the business of the company, due to the fact that for these jobs’ s/he is not registered in the Serbian Business Register Agency (it is understood that there is another person registered to represent the company).

Founders and / or Members of a company who have established an employment relationship in their company are entitled to earnings, reimbursement and other income based on the employment relationship in accordance with the law governing employment, a general act with the employer and a contract of employment. This person has all the rights and obligations on the basis of employment like any other employee.

Income Tax is calculated and paid at the rate of 10%.

Founders and / or Members of a company are entitled to a dividend or a share in the profits of the company in accordance with the general act of the company (which is taxed as capital income at the rate of 15%).

Founders who WORK in their company and are REGISTERED to represent the company but are NOT in employment with their company or with another employer

For individuals who are Founders or Members of a company, and are registered to represent that company in which they do not have an employment relationship (and are not employed by another employer), the contribution base is at least the lowest monthly contribution basis.
For these persons, as Founders or Members of a company, all three contributions are calculated and paid as follows:

1. For compulsory pension and disability insurance – 26%;
2. For compulsory health insurance – 10.3%;
3. For unemployment insurance – 1.5%.

The personal income tax is NOT calculated because the individual does not receive the contractual remuneration for his / her employment as a Founder or a Member of a company.

If you need trustworthy associates with experience and knowledge regarding contributions for legal representatives of Serbian Company contact Asst Office.

The right to free access to the labor market in Serbia, i.e. employment, self-employment and practice the right in case of unemployment, unless otherwise stipulated by an international treaty binding to the Republic, shall have:

1. EU citizens;
2. Members of the family of citizens referred to under 1., who are not EU nationals and who are granted temporary residence or family residence in those countries proving their right to free access to the labor market.

Who is considered as a family member?

Family members of EU citizens are:

1. Spouses married or extramarital of EU citizens, in accordance with the law;
2. Direct descendants of EU citizens under 21 years of age or direct descendants of their spouse, whether married or extramarital, under 21 years of age;
3. Adopted children under 21 years of age or pastors of EU citizens or their spouse, whether married or extramarital, under 21 years of age;
4. Natural persons stated under 2. and 3. of this paragraph older than 21 years of age who are unable to support themselves on their own, i.e. who is obliged to support an EU citizen or his or her spouse in marriage or extramarital;
5. The direct ancestors of EU citizens or the direct ancestors of their spouse, whether married or extramarital, which the EU citizen or his or her spouse is obliged to support.

Natural persons who have the right to free access to the labor market do not need a work permit within the meaning of the provisions of Law on Employment of Foreigners.

Can foreign employer direct non-EU foreigner to work in Serbia?

A foreign employer domiciled in a Member State of the European Union, the European Economic Area or the Swiss Confederation may send a non-EU foreigner to work in Serbia without a work permit within the meaning of the Serbian Law, unless otherwise provided by an International Treaty binding for the Serbia.

The foreign employer may direct the foreigner referred to in previous paragraph of this Article provided that he has:

1. Contract concluded with the employer or the end user of the services, which must include the place and deadline for performing the work;
2. Concluded an employment contract with the foreigner referred to in previous paragraph this Article in accordance with the law in force in the Member State in which the foreign employer is established;
3. The Act on Reference to Temporary Work in the Republic of Serbia, which determines the manner of exercising rights and obligations from work, as well as the manner of accommodation and food during the stay and work in the Republic.

The employment of a foreigner is realized on condition that he / she has a long-stay visa on the basis of employment, a temporary residence permit or permanent residence permit and a work permit, unless otherwise stipulated by Serbian Law.

Work permits for foreign workers

A work permit, shall be considered an Act on which grounds a foreigner may be employed or self-employed in Serbia.

A work permit may be issued as:

• Personal Work Permit; or
• Work Permit.

Only one type of work permit is issued for the same time period.

For all additional information regarding employment of a foreigner in Serbian, temporary and permanent residence permits, and work permits contact Asst Office, and our team will provide you with all necessary information.

Dissolution of a Serbian limited Liability Company is the procedure that is completed before Serbian Business Register Agency. This procedure is hard and rather complicated, which includes preparation of all acts necessary for conducting the dissolution procedure, filing relevant registration applications to the Business Registers Agency, as well as all other actions aimed at lawful implementation of the dissolution process.

What are the legal grounds for dissolution?

Dissolution before Serbian Business Register Agency can be done on 4 legal grounds:

1. After the dissolution or compulsory dissolution procedure has been carried out;
2. After the conclusion of bankruptcy proceedings;
3. In accordance with The Decision or Termination of the Founding of a Representative Office / Branch of a Foreign Company;
4. Due to a status change that results in the deletion of one of the participants from the Register.

If a company is deleted from the Register after the dissolution bankruptcy or status change process has been carried out, it is obliged to submit Extraordinary Financial Statement to the Register of Financial Statements and Credit ratings. In cases of deletion, branches of a foreign legal entities are also obliged to submit Extraordinary Financial Statements.

What is Extraordinary Financial Statement (the Statement)?

The Statement is to be submitted within 60 days from the date of preparation. It is to be submitted using the Agency’s special information system, in electronic form, by selecting the appropriate request, signed by a qualified electronic signature of the legal representative.

If the obligors does not submit the Statement through a special information system, but submit it in paper form, the Agency will inform the obligor in a special letter that the stated Statement has not been submitted in accordance with the Law on Accounting, in electronic form, and that it will not be processed or published on the website Agencies. Also, it must be signed by a qualified electronic signature of the legal representative.

This Statement consists of the following documents:

• Balance Sheet; and
• Profit and Loss Sheet.

What documents must be submitted in this process?

To successfully finish this procedure following documents must be submitted:

• Application for Deletion from the Business Register Agency, after the completion of the dissolution procedure,
• The Decision of the General Assembly to end the dissolution procedure,
• Statement of the Liquidator that the dissolution has been finished,
• Statement of the Liquidator that all obligations of the Company on the basis of reported claims have been fully settled and that no other actions are to be undertaken against the Company,
• Decision on Division of the Dissolution Residue of the Company,
• Decision of the company on the person to whom the books and documents are entrusted for safekeeping or the statement of the Liquidator on the name and address of that person,
• Proof of termination of tax liabilities issued by the competent Tax Authority, which is not older than five days at the moment of filing a request for deletion from the stated Register, pursuant to the provision of Article 29, paragraph 7 of the Law on Tax Procedure and Tax Administration.

If you want to know more on this topic, or you need assistance regarding dissolution of a Serbian Limited Liability Company, contact Asst Office team today!