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5 Reasons to Incorporate an IT Company in Serbia

5 Reasons to Open an IT Company in Serbia

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.

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The Right of Foreigners to Acquire Real Estate in Serbia

The Right of Foreigners to Acquire Real Estate in Serbia

There are certain conditions that must be met for foreigners to acquire real estate in Serbia. First there must be reciprocity concerning the acquisition of property rights of the real estate. This means that, both individuals and legal entities, can acquire property right of real estate on the territory of the Serbia, either through legal transaction inter vivos (Sales Contracts, Gift Contract, etc.) and legal transactions mortis causa (by inheritance) only if there is reciprocity.

Acquisition through legal transactions among the living (inter vivos)

Law on Fundamentals of Property Relations (The Law) stipulates that foreigner individuals or legal entities that do business in Republic of Serbia can upon reciprocity acquire property rights of real estate which they need for their business activities. On the other hand, foreigner that does not do business in Serbia can upon reciprocity acquire property rights of real estate on the same conditions as citizens of Serbia.

In addition to this, foreign individual or legal entity cannot acquire agricultural land, as stipulated by the Law on Agricultural lands, unless it is differently stipulated by Stabilization and Association Agreement between the European Community and its Member States and the Republic of Serbia. Same Agreement stipulates that agricultural land means land used for agricultural production (arable land, gardens, orchards, vineyards, meadows, pastures, ponds, reeds and wetlands) and land that can be used for agricultural production.

The Court or other authority before which the question of reciprocity is raised (e.g. the Real Estate Cadastre), if it is not already aware of this, should seek the necessary explanation of reciprocity from the Ministry of Justice. Any other interested person may request clarification on reciprocity, as well.

The question of the kind of reciprocity required for the acquisition of real estate is not regulated by the Law, and its initial premise is that this acquisition does not require the existence of contractual (diplomatic) reciprocity with the foreign country, but rather that the legislation of that country allows the possibility of acquiring real estate for foreigners under conditions not significantly more severe than those stipulated by Serbian law, as well as in practice allowing citizens of Serbia to acquire real estate on the territory of the respective country (factual reciprocity).

The Republic of Serbia has established contractual reciprocity for the acquisition of property rights of the real estate through legal transactions, inter vivos, by individuals with only a small number of countries, based on trade and navigation contracts concluded in the first half of the 20th century.

In some of them reciprocity is explicitly contracted, and with some of them reciprocity exists by applying the Clause of the post privileged nation. These Agreements were signed with United Kingdom, United States, Kingdom of the Netherlands and Japan.

For other countries that Serbia has reciprocity with, but has not been contracted, the Ministry of Justice has, on the basis of the legal regulations of the respective states governing this matter, that is, by exchanging notes, established the existence of reciprocity.

Those countries are: Argentina, Australia, Austria Belize, Belgium, Belarus, Brazil, British Virgin Islands, Bulgaria, Greece Denmark, Dominican Republic, Israel, Iran, Ireland, Japan, Armenia, South Africa, Republic of Kazakhstan, Canada, China, Lebanon, Latvia, Lithuania, Luxembourg, Hungary, Malta, Mexico, Moldova, Germany, Norway, Panama, Peru, Portugal, Russian Federation, Romania, Singapore, Syria, Slovakia, Turkey, Uzbekistan, Ukraine, France, Netherlands, Croatia, Czech Republic Swiss, Confederation, Sweden, United Arab Emirates, Azerbaijan, El Salvador, Cuba, Senegal Yemen, Colombia, Republic of Korea and Sri Lanka.

Acquisition through legal transactions mortis causa

Foreigners may, under conditions of reciprocity, acquire the right of ownership of real estate located in Serbia by inheritance under the same conditions as domestic citizens.

Acquisition of immovable property is governed by a number of countries by bilateral Legal Assistance Treaties containing a national treatment clause, that is, stipulates that nationals of one Contracting Party may inherit property in the territory of the other Contracting Party under the same conditions and to the same extent as nationals.

In this way, contractual (diplomatic) reciprocity is ensured. Such a solution is contained in Legal Aid Agreements, Trade and Navigation Contracts with the following countries: Austria, Belarus, Bosnia and Herzegovina, Bulgaria, United Kingdom, Japan, Hungary, Mongolia, Poland, Russia Federation, Romania, Ukraine, USA, Slovakia, Montenegro, Netherlands, Czech Republic and Slovenia.

Relative to countries where there is no contract reciprocity for the acquisition of property rights by inheritance, for many years the starting point has been that reciprocity need not be determined in relation to each individual country, but rather to assume that each country recognizes the right of inheritance of real estate of our citizens to the evidence to the contrary, which means that foreign nationals may inherit real estate in the Serbia on the basis of assumed factual reciprocity, provided that the interested parties can prove otherwise.