Law on Foreign Investment
Serbia's law equalizes the rights and responsibilities of domestic and foreign investors, with full legal security and protection of rights acquired by virtue of investment. A foreign investor (foreign legal entity whose seat is abroad, foreign natural person, or national of Serbia having domicile or residence abroad for a period exceeding one year) has the right to:
Control or take part in the management of the company he has founded or in which he has invested his capital;
Transfer the rights and obligations (set out in the investment contract or the founding act) to other foreign or domestic persons;
Share and freely dispose of the profit accruing from his investment;
Inspect the books and business operations of the company in which he has invested;
Audit the interim and annual financial statements, either personally or through an authorized representative;
Freely and without delay transfer all financial and other assets related to the foreign investment (profits, dividends, additional payments, property upon dissolution of the enterprise etc.) abroad in a convertible currency.
A foreign investor is also allowed to buy real estate – business premises and apartments, provided the reciprocity condition is met. Urban construction land is still state-owned, implying that a foreign investor (as well as a domestic investor) may be given only the right to use it, for which a charge is to be paid.
Investment may be made by founding a new company, or by expanding the capital of an existing domestic company. The acquisition of shares in the initial capital of a company, or any other property right through which a business interest in Serbia is realized, is considered foreign investment, as well.
A foreign investor may freely found or invest in any company, except for those in the field of production and trade of armaments, or in certain other areas defined as restricted by law. In these areas, a foreign investor may establish a company, or invest only with a domestic entity, but may not acquire majority rights in the management of such a company. The Ministry of Defense of Serbia must also give its consent.
Additional restrictions are provided for founding an insurance company, which a foreign natural person or legal entity may found only as a joint venture with a local natural person or legal entity. As an exception to this rule, a foreign legal entity may found a wholly owned captive insurance company for offshore activities only. An insurance company with foreign capital is not allowed to carry out re-insurance activities abroad.
All companies including those founded using a foreign person’s assets are obliged to register through the Business Registration Agency. Investment incentives
SIEPA announced the third call for applications for receiving financial assistance and the application deadline is March 16, 2007. In addition to the existing benefits comprising highly qualified labor force at competitive prices, the possibility of duty-free exports to all the markets in South East Europe and Russia, strategic geographic position and the lowest corporate profit tax in Europe at 10%, Serbia is proud to offer financial assistance for future investments in the country. Based on the Serbian Government Decree adopted in late June of 2006, the non-refundable funds will be assigned according to specified criteria for investment projects in all areas, except for trade, tourism, hospitality and agriculture. Eligible companies are those involved in manufacturing activities, internationally marketable services sector* and research and development sector.
Invest in Obrenovac
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