Serbia has fully recovered after the COVID-19-driven recession, and its economy shows a steady GDP growth of 2.5% despite all pessimistic scenarios. Investors, including major ones, continue to flock here and pour millions of dollars into this promising Balkan country. It has a BB+ rating with a stable outlook according to Fitch and Standard and Poor’s. Serbia offers an excellent business climate and broad opportunities for entrepreneurs seeking to set up a company here. Are there any drawbacks? Well, they are pretty much the same as you would find in other European countries. On the other hand, you will find a lot of exceptional benefits here unavailable in other countries in Europe! Discover more about the country on SerbiaWealth, a portal devoted exclusively to this jurisdiction.
Why Serbia?
Let’s look at the main reasons why you should prefer Serbia to other destinations:
- This is a respectable onshore jurisdiction. Gray zones with low taxes and a high level of confidentiality are gradually fading away, and the trend for transparency and legalization is here to stay for a decade ahead. Serbia is going to join the EU in 2025, so it strictly complies with all the requirements imposed by international regulators, meaning that it will never be blacklisted.
- Serbia is steadily developing. In 2019, the country signed the United Nations Convention on International Settlement Agreements Resulting from Mediation (Singapore Convention), which is a sign that its international trade operations are going to be more stable and predictable. This also marks the country’s focus on making the conditions for entrepreneurs from across the globe even more attractive.
- Serbia is on the verge of joining the EU. Even though this is not a clear path that requires simple steps, the local government is doing its best to satisfy all the demands set by relevant European authorities to achieve the aim. Many countries expressed their willingness to see Serbia among EU members. On the other hand, there are concerns about the growing influence of China in the region and the country’s friendly relations with Russia, which may delay the process.
- Serbia is a neutral country – both politically and economically. The present-day situation requires you to be very careful when it comes to business relations with partners from sanctioned countries as your bank accounts may simply be frozen. Serbia remains neutral in relations with all the key players, which will help you safely engage in your business activities.
- Low company maintenance expenses. If you compare company maintenance costs on average in Europe, Serbia looks really competitive. If you need to rent an office, you can do so at 200 euros a month. Utility bills are among the lowest in Europe. The average salary is about 700 euros a month, and you will have no problems finding highly skilled employees.
If you have any questions, please follow the above link to ask them.
Choosing a Legal Form
Let’s look at the legal forms available under Serbian laws:
- Joint-stock company
- Limited partnership company
- Partnership company
- Limited liability company
- Sole proprietor
The most popular form is, of course, the limited liability company.
Here are some additional legal forms:
- Representative office of a non-resident legal entity
- Branch office of a foreign company
- Branch office of a resident company
Let’s look at the benefits of the two most common forms.
Sole proprietor
- The registration procedure is very quick and simple
- The accounting requirements are rather relaxed
Limited liability company
- This is the most popular and widespread company form
- Its members have limited liability (it is limited to their contribution to the company)
- Foreign employees can be hired without any restrictions
As for the branches, they have the same advantages as LLCs.
Company Name
That’s an important step as you will have to comply with a number of requirements:
- Make sure the name sounds polite.
- If you want to use the name of any specific area in Serbia or the word “Serbia” in the name, you will have to obtain special permission.
- The company name is required to be in Serbian (you can use Latin or Cyrillic letters).
- The name must be unique.
- The name of another country included in the company name will also require permission from the respective country.
- The company name you select must not violate the existing intellectual property rights.
Choosing Economic Activity Codes
When you set up a company in Serbia, you will have to choose the principal type of business activity. The primary activity you select must be the one that generates the largest profit. Keep in mind that certain activities can only be carried out if you have specific approval. Additional codes can only be registered if you have the licenses and permits that allow you to conduct them.
Legal Address
If you are on a tight budget, you can rent a virtual office instead of a physical one as it gives the same opportunities. However, if you are planning to have a business that functions steadily, we strongly recommend that you take care of economic substance in Serbia (with a physical office being its part).
Memorandum of Association
This is the most important document, so it should be compiled with due care. It is made up by the company founders and certified by a notary. Let’s look at the main details it should include:
- Company name
- Key information about the company members
- Company’s legal address
- Contributions to the company made by each member
- Amount of registered capital
- Responsibilities and authority of the appointed director
Documents for Registration
Most people need help with company registration, so think twice before you decide to venture on your own as you may eventually spend more than the registered agent’s fee. However, you may have enough legal competencies to make your way to company registration by yourself, and in this case, the decision makes sense.
Here are the documents you will need to prepare:
- A standard application
- ID documents for individual founders or corporate documents for legal entities
- Memorandum of Association
- Confirmation of registration fee payment