Doing business in Serbia

01Legal system and investment climate

Serbia has a civil-law system. It has been an EU candidate country since March 2012, the EU-Serbia Stabilisation and Association Agreement has been in force since 1 September 2013, and accession negotiations opened on 21 January 2014. According to the European Commission, 22 of 35 negotiating chapters have been opened, two of them provisionally closed. Alignment with EU law shapes company, competition, data protection and financial rules, but Serbia is not a Member State and EU directives do not apply directly. For example, the EU Transfer of Undertakings Directive does not apply in Serbia.

The Law on Investments (Official Gazette 89/2015, 95/2018) gives foreign investors the same position, rights and obligations as domestic investors (Article 7), protects investments against expropriation other than in the public interest and against compensation (Article 6), and guarantees the free transfer of dividends, royalties, interest and sale proceeds after taxes are paid (Article 9).

The main statutes an investor will meet are:

• Law on Business Companies, the Company Law (36/2011 and later amendments, most recently 19/2025)
• Law on Obligations (contracts and torts)
• Labor Law and Law on Employment of Foreigners
• Law on Protection of Competition
• Law on Planning and Construction
• Law on Personal Data Protection (87/2018)
• Law on the Central Register of Beneficial Owners (19/2025)

02Forms of business presence and registration

A foreign investor usually chooses one of four forms:

• Limited liability company (d.o.o.): a separate legal entity. The minimum share capital is RSD 100, unless a special law requires more for a regulated activity (Company Law, Article 145).
• Joint stock company (a.d.): a separate legal entity with minimum share capital of RSD 3,000,000, unless a special law requires more (Article 293).
• Branch of a foreign company: not a legal entity. It acts in the name and for the account of the foreign company, which is liable without limit for obligations arising from the branch's business (Articles 567 and 573).
• Representative office: not a legal entity. It may carry out only preliminary and preparatory acts aimed at concluding transactions of the foreign company, and legal acts related to its own current operations (Article 574).

Registration is handled by the Business Registers Agency (APR). An application to found a company can be filed only electronically (Law on Registration Procedure, Article 9). The registrar decides within five working days of receiving the application (Article 15), and changes to registered data must be filed within 15 days (Article 10), including transfers of stakes in a company. Branches and representative offices are registered with APR as well (Company Law, Articles 569 and 577). When a company is founded electronically, its beneficial owner data are entered in the Central Register during incorporation. DRG has noted that company formation in Serbia still involves formalities and timelines that exceed the benchmark of the proposed EU Inc. initiative.

03Acquisitions: share deals and asset deals

In a share deal the buyer acquires the stake (in a d.o.o.) or the shares (in an a.d.) and takes the company with all its liabilities. Stakes are not securities (Company Law, Article 150) and their transfer is free unless the law or the founding act says otherwise (Article 160). Other members have a pre-emption right, unless the founding act excludes it (Articles 161 to 166). If nobody uses it, the seller may sign with the third party within 90 days on terms no more favourable than those offered to the members (Article 165). The change of members is then registered with APR.

In an asset deal the buyer selects what it acquires, but DRG points to ten issues to keep in mind. A person acquiring a body of assets is liable for the debts relating to it jointly with the transferor, up to the value of the assets, and a contract clause excluding this has no effect against creditors (Law on Obligations, Article 452). Encumbrances generally stay with the assets. Acquisition requires both a legal ground and a mode of acquisition, such as registration in the land registry. A transaction involving assets worth 30% or more of the company's total book assets needs shareholder approval and can trigger a buy-out right for dissenting minority shareholders (Company Law, Article 470). The EU Transfer of Undertakings Directive does not apply, and an asset deal may also require merger approval.

Legal due diligence in either structure usually covers:

• title to real estate and registered encumbrances
• corporate approvals, pre-emption rights and change-of-control clauses
• permits, licences and sector regulator consents
• employment, litigation and tax exposure

04Merger control

Concentrations are reviewed by the Commission for Protection of Competition under the Law on Protection of Competition (Official Gazette 51/2009, 95/2013; the text was also touched by 35/2026). A filing is mandatory if either: (1) the parties' combined worldwide turnover exceeds EUR 100 million and at least one party has turnover in Serbia above EUR 10 million; or (2) the combined turnover in Serbia of at least two parties exceeds EUR 20 million and at least two parties each have turnover in Serbia above EUR 1 million (Article 61). The turnover of the preceding accounting year counts. Foreign-to-foreign deals are caught even where the target has no turnover in Serbia, and a takeover bid must be notified even below the thresholds.

The notification is due within 15 days of the earliest of signing the agreement, publishing the public offer, or acquiring control, and can be filed earlier on the basis of a letter of intent (Article 63). Implementation must be suspended until the Commission decides (standstill, Article 64). The Commission decides within one month of a complete filing, and silence counts as approval (Article 65). DRG's guide gives up to four months for Phase II, filing fees of 0.03% of combined turnover capped at EUR 25,000 in Phase I and 0.07% capped at EUR 50,000 in Phase II, and a short-form filing for uncomplicated cases. Closing without approval can lead to a measure of up to 10% of turnover in Serbia (Article 68), although DRG has described the fines imposed in practice as modest.

To check whether a transaction meets the Serbian thresholds, and those of four other Western Balkan jurisdictions, use the DRG tool Merger Control in the Balkans.

05Employment and work permits for foreigners

Under the Labor Law (24/2005 and later amendments, most recently 109/2025) the employment contract is concluded in writing before the employee starts work; otherwise employment is deemed open-ended from the first day (Article 32). Probation may last up to six months (Article 36). A fixed-term contract needs objective grounds, and successive fixed-term contracts with the same employee may not exceed 24 months in total, with gaps shorter than 30 days ignored (Article 37). Exceptions include replacing an absent employee, a defined project, a foreign national until the work permit expires, and an employer registered for less than a year (up to 36 months). Full working time is 40 hours a week, overtime is capped at eight hours a week and 12 hours a day in total (Articles 51 and 53).

The employer needs a lawful reason to dismiss, relating to the employee's ability or conduct, or to technological, economic or organisational changes (Article 179). The decision must be in writing with reasons and advice on legal remedy (Article 185). Redundancy severance may not be lower than one third of the salary for each year of service with the employer (Article 158).

Foreign nationals need a single permit for temporary residence and work. It has applied under the Law on Employment of Foreigners since 1 February 2024 (amendment 62/2023). The National Employment Service assesses the conditions within 10 days, and for ordinary employment a labour market test is part of the request. Foreigners' employment ends when the permit ends, and the Government may set quotas. Special cases exist for seconded staff and intra-company transfers of managers and specialists, assessed for up to three years and extendable for up to three more.

06Real estate and construction permits

Foreign investors may acquire ownership of real estate in Serbia in accordance with the Constitution and the law (Law on Investments, Article 7). Under the Law on Basic Property Relations, foreign legal entities and individuals acquire real estate subject to reciprocity (Articles 82 and following). DRG notes that this limit is often bypassed in practice by buying through a Serbian company. Serbian law always governs transactions in Serbian real estate, and Serbian courts have exclusive jurisdiction over disputes on ownership or other property rights in it and on its lease. Ownership passes on registration in the land registry.

Construction is governed by the Law on Planning and Construction (72/2009, amended repeatedly, most recently 80/2026). Permitting runs through a unified electronic procedure handled by one department of the competent authority (Articles 8 and 8a). The main steps are location conditions (Article 53a), the building permit (Article 135), notification of works and, after technical inspection, the use permit (Article 158). The law sets five working days for issuing location conditions once all required documents are obtained, for the building permit after the request, and for the use permit (Articles 8d and 158). Real timelines often differ, so the schedule should be tested with the authority early.

Existing buildings should be checked for lawful status. Serbia has a separate legalisation regime for unlawfully built buildings, which DRG covered in 2018.

07Tax basics

Rates below were checked on 30 September 2026 against the consolidated texts of the laws as published in the Official Gazette (reproduced by Paragraf Lex).

• Corporate income tax: 15% (Law on Corporate Income Tax, Article 39).
• VAT: standard rate 20%, reduced rate 10% for the goods and services listed in the law (Law on VAT, Article 23).
• Withholding tax: 20% on dividends, royalties, interest, rent and fees for market research, accounting, audit, legal and business advice paid by a Serbian resident to a non-resident legal entity, unless a double tax treaty provides otherwise. The rate is 25% for royalties, interest, rent and service fees paid to recipients in preferential tax jurisdictions (Article 40).
• Individuals: tax on capital income, which includes dividends, is 15% (Law on Personal Income Tax, Articles 61 to 64).

Tax treaties can lower the withholding rates, so the applicable treaty must be checked for each payment. A tax package published in the Official Gazette on 1 September 2026 (80/2026) amends the corporate income tax, VAT and personal income tax laws. It leaves the rates above unchanged, and most of its provisions apply from 1 January 2027. Its corporate income tax part introduces EU-aligned rules, including measures against profit shifting, and removes some existing incentives (see the incentives chapter).

08Data protection

The Law on Personal Data Protection (Official Gazette 87/2018) replaced the 2008 law and is aligned with the GDPR. It has applied since August 2019, nine months after entering into force (Article 102). It covers controllers and processors established in Serbia. It also covers foreign controllers and processors that offer goods or services to people in Serbia or monitor their behaviour there (Article 3).

Points that most often matter to a foreign company:

• A foreign controller or processor caught by the law must appoint a representative in Serbia in writing, except in limited cases such as occasional, low-risk processing (Article 44).
• A data protection officer is mandatory for public authorities and for entities whose core activities involve regular and systematic monitoring of many people or large-scale processing of special categories of data (Article 56).
• A personal data breach likely to create a risk must be notified to the Commissioner without undue delay and, where possible, within 72 hours (Article 52).
• Transfers of personal data out of Serbia are permitted only under the conditions of the transfer chapter of the law (Article 63 and following), which DRG summarised in 2019.

09Beneficial owners and anti-money laundering

Under the Law on the Central Register of Beneficial Owners (Official Gazette 19/2025, 51/2025, 60/2025), applied from 1 October 2025, companies (other than public joint stock companies), branches and representative offices of foreign companies, cooperatives, associations, foundations and institutions must record their beneficial owners with APR (Article 2). A beneficial owner is a natural person who, directly or indirectly, holds 25% or more of the shares or votes, has a dominant influence over management, or indirectly provides funds and thereby significantly influences decisions, with special rules for trusts and foundations (Article 3).

• Data are recorded within 30 days of the ground for registration, together with the documents on which beneficial ownership is based (Article 8). DRG notes that this includes a copy of a foreign owner's passport or ID.
• Accuracy must be verified within a year of the last registration or confirmation (Article 9), and supporting documents kept for ten years (Article 12).
• Existing entities had to comply by 30 November 2025, according to DRG.
• A missed filing is an offence with a fine of RSD 500,000 to 2,000,000 for the company and RSD 50,000 to 150,000 for the responsible person (Article 19). Intentionally concealing a beneficial owner is a crime punishable by six months to five years in prison (Article 18).

Anti-money laundering duties fall mainly on obligors listed in the Law on Prevention of Money Laundering and Terrorism Financing (113/2017, most recently amended by 19/2025): banks, exchange offices, insurers, broker-dealers, auditors, accountants, real estate intermediaries, digital asset service providers, and lawyers and notaries when they assist with, for example, buying or selling a company or real estate. A trading or manufacturing company is not an obligor as such, but should expect know-your-customer requests from its bank, lawyers and notaries and must be able to document its ownership (Article 4).

10Dispute resolution and enforcement

Commercial courts hear disputes between domestic and foreign business entities, company law disputes, disputes on foreign investment, insolvency and enforcement in their competence. Appeals go to the Commercial Appellate Court in Belgrade (Law on Organisation of Courts, Official Gazette 10/2023, Articles 18 and 27).

Arbitration is governed by the Law on Arbitration (46/2006), which covers domestic and international arbitration. Parties to an international arbitration may choose foreign law. The Foreign Trade Court of Arbitration at the Serbian Chamber of Commerce, which dealt with international disputes, was merged with the Permanent Court of Arbitration into a single institution, the Permanent Arbitration at the Chamber of Commerce and Industry of Serbia, which now hears both domestic and international commercial cases.

Foreign arbitral awards: Serbia is a party to the New York Convention, by succession, with reservations for reciprocity, commercial matters and non-retroactivity. Under the Law on Arbitration a foreign award has the force of a final domestic judgment once the competent court recognises it, and recognition can be decided as a preliminary question in enforcement proceedings (Articles 64 and 65).

Foreign court judgments produce effect only after a Serbian court recognises them. The applicant must file proof that the judgment is final (Article 87). Recognition is refused, among other grounds, if the defendant could not take part because of improper service, if Serbian courts have exclusive jurisdiction, if the matter was already decided, if it violates the fundamental principles of the legal order, or if reciprocity is missing, which is presumed to exist until proven otherwise (Articles 86 to 92 of the Law on Resolution of Conflict of Laws).

11Investment incentives

Cash incentives for direct investment in manufacturing and service centres are regulated by a Government Decree (Official Gazette 1/2019, 39/2023, 43/2023), applied through the Development Agency of Serbia. According to a press summary reproduced by Paragraf Lex in July 2025, a manufacturing project must involve at least EUR 500,000 of eligible investment and 50 new permanent jobs in the Belgrade region, EUR 400,000 and 40 jobs in Vojvodina, and EUR 300,000 and 30 jobs elsewhere. Service centre projects need at least EUR 150,000 and 15 jobs. Support can cover EUR 2,000 to 5,000 per new job and 10% to 30% of eligible investment costs, with the beneficiary contributing at least 25% of eligible costs from sources free of state aid. Sectors such as trade, transport, hospitality, energy and mining are excluded, and the investment and jobs must be kept for three years (small and medium companies) or five years (large companies).

On the tax side, DRG described in January 2025 a corporate income tax credit of 30% of amounts invested in qualifying startups. The 2026 tax amendments (Official Gazette 80/2026) remove a number of corporate income tax incentives, with transitional protection for taxpayers who met the conditions by 31 December 2026 (Article 50j of the old text) or by 31 December 2027 (Article 50a, paragraph 1). Any plan that relies on a tax incentive should therefore be checked against the transitional rules before signing.