Establishing a company in Serbia offers foreign investors a gateway to the Western Balkans and broader European markets. With its competitive labor costs, strategic location, and streamlined incorporation processes, Serbia is an attractive destination for small and medium-sized businesses looking to expand.
This guide outlines the main types of legal entities, their requirements, and the corporate tax framework to help you navigate the process of establishing a company in Serbia successfully.
1. Limited Liability Company (D.O.O.) in Serbia
The Drustvo sa Ogranicenom Odgovornoscu (D.O.O.) is the most commonly preferred legal structure for doing business in Serbia.
- Minimum Share Capital: €500
- Maximum Number of Shareholders: 50
- Liability: Limited to each shareholder’s capital contribution
- Management:
- Major decisions are made by the general meeting of shareholders
- Day-to-day operations are overseen by a managing director
Foreign individuals and legal entities can freely establish and own a D.O.O., making it a highly accessible and flexible option for establishing a company in Serbia.
2. Joint Stock Company (A.D.) in Serbia
Joint Stock Companies (Akcionarsko Društvo – A.D.) are more suitable for large-scale businesses, particularly those aiming to raise capital or go public.
- Closed Joint Stock Company
- Minimum Share Capital: €10,000
- Maximum Shareholders: 100
- Open Joint Stock Company
- Minimum Share Capital: €25,000
- Unlimited number of shareholders
- Shares can be listed on the stock exchange to attract investors
This structure is ideal for corporations planning substantial growth or capital market participation.
3. General Partnership in Serbi
A General Partnership is formed by two or more individuals or legal entities through a partnership agreement.
- No minimum capital requirement
- Liability: Partners have unlimited joint and several liability
- Decision-making: All partners must agree on business decisions
While not commonly preferred by foreign investors, this form is still used for simple business models where mutual trust among partners is high.
4. Branch Offices in Serbia
Foreign companies can establish branch offices in Serbia to conduct business without incorporating a separate legal entity.
- Registration: Required with the Serbian Business Registers Agency
- Legal Status: Branches operate under the parent company’s legal personality
- Use Case: Suitable for expanding international operations with minimal structural changes
Taxation in Serbia
Understanding the local tax environment is essential when establishing a company in Serbia.
Corporate Tax
- Standard Rate: 15% on profits
- Serbia offers one of the lowest corporate tax rates in Europe, enhancing its appeal for international businesses.
Value-Added Tax (VAT)
- Standard Rate: 20%
- Reduced Rate: 8% (applies to basic goods and certain services)
All companies with annual turnover above the VAT threshold must register and comply with VAT obligations.
Conclusion
From limited liability companies to joint stock companies and branch offices, establishing a company in Serbia provides a variety of legal structures to suit your business needs. With a transparent regulatory environment and attractive tax rates, Serbia remains a strong option for international entrepreneurs looking to gain a foothold in Southeast Europe. For more information, please contact us.
