One of the frequently asked questions is whether online company registration is possible in Serbia. The answer to this question is yes! Not only is it possible, but it is also the only way to register a company since mid-May 2023. The new regulation provides significant flexibility to founders, with the noteworthy involvement of lawyers in this process, allowing company founders to save time and costs.
In a previous blog post discussing the use of electronic signatures for business activities, we highlighted that company registration in Serbia can now be done from the comfort of your own home, thanks to the electronic signature issued by a certification body in the Republic of Serbia.
The Serbian Business Registers Agency (SBRA) introduced the service of electronic registration for sole proprietors as early as 2018 and later extended it to single and multi-shareholder companies. Today, company formation in Serbia is exclusively conducted online, in line with the government’s policy of digitalizing public administration.
History vs Today – How Are the Companies Incorporated?
Before the introduction of online company registration, the process of opening a business in Serbia consisted of two stages after preparing the necessary documentation:
- Signing the Articles of Association in paper form by the founders (or their authorized representatives) and having the signatures notarized by a public notary.
- Submitting the registration application with supporting documents to the Serbian Business Registers Agency in paper form.
Today, the new rules of online company registration provide greater flexibility. If the company founder possesses a qualified electronic certificate (electronic signature) issued by a certified body in Serbia, the Articles of Association can be signed electronically, eliminating the need to visit a public notary.
On the other hand, if the founder does not have a Serbian-qualified electronic certificate, that is not a barrier. Attorneys, with a special power of attorney, can perform all the necessary actions related to company formation on your behalf. In addition to a public notary, attorneys are the only ones authorized to electronically certify “paper” documents when submitting the online registration application for company formation. This is particularly significant in cases where the company founder is a foreign individual who typically does not possess an electronic signature issued in Serbia, and when the entire company formation process is conducted remotely, without the founder’s physical presence.
Therefore, the following activities can be conducted remotely (without coming to Serbia):
- Company formation in Serbia
- Execution of all other activities related to company formation in Serbia
We will cover all the steps of online company registration, as well as the advantages and important aspects of starting or relocating a business to Serbia, in the following sections.
Advantages of Incorporating a Company in Serbia
When starting a new business in a foreign country, it’s important to consider all the benefits provided by the laws.
One of the first steps is to consult with tax experts and familiarize yourself with the list of duties, as well as the abundance of tax incentives and incentives available in Serbia.
Important aspects to explore include tax rates, government incentives, taxes, and other economic benefits, employer obligations, the business climate of the country where you are establishing the company, availability of a wide range of marketing and consulting services, etc.
Serbia provides significant non-refundable funds for founders of new companies, particularly in the field of innovative activities such as the IT sector. Additionally, significant tax incentives are provided for employing foreigners and young returnees in the field of innovative activities. Serbia boasts one of the lowest corporate income tax rates in Europe[1]. In terms of cost and efficiency, Serbia is an attractive destination for starting a new business. Not only are the costs of company formation relatively low compared to other countries in the region, but also the administrative costs incurred by your newly established company are symbolic. An example of such a cost is the so-called environmental fee.
Further advantages of doing business in Serbia, as well as favorable labor legislation for foreigners, are covered in our blog post regarding investments in Serbia.
The Process of Company Registration in Serbia
There are 7 essential steps in the procedure of company registration in Serbia, described in detail in our blog on company formation in Serbia.
While skipping the unnecessary repetition, we would like to highlight some of the specific points (colored in red) regarding the remote company registration in Serbia.
After you choose the most appropriate legal form for your needs (step 1), you would be challenged with the choice of an adequate business name for your company (step 2).
In the company formation process the next step would be:
3: Registration of the Company’s Business Address
This is the first specific point of remote company registration in Serbia, comparing it to the traditional one.
Although the companies in the process of remote registration could establish a seat where they will perform business activities, almost all the companies established remotely opt for a virtual seat, at least for the initial period.
The virtual office in Serbia services usually consist of (depending on the provider):
- providing an office address,
- providing a mailbox and email address,
- receiving all the mail addressed to your company,
- notifying the received mail, etc.
The advantages of the registration of the virtual office in Serbia are numerous. For example, saving money for utility costs and rental fees, as well as other expenses related to rented business premises.
It is common practice for founders or CEOs of companies to want to see a property before renting or purchasing it. However, in the case of remote company formation, there is no need or obligation for the founder to be physically present in Serbia. As a result, almost all founders opt for a virtual office for their newly established companies.
Moreover, for various types of businesses, especially those involving intellectual activities, there is no need to have all employees physically present in a centralized office. Remote work is becoming increasingly popular in practice, with employees often not needing to come to the office at all.
After finding a virtual office in Serbia, the next step is arguably the most important in the company formation process.
4: Creation of the Articles of Association
The Articles of Association is a document through which founders formally decide to establish a company and determine key aspects of its operations. By including specific clauses in your Articles of Association, you ensure a high level of asset protection and safeguard your company’s know-how right from the start. To ensure that the provisions of the Articles of Association fully comply with current legal requirements, it is advisable to consult with an expert in corporate law.
In the case of multiple members, the mutual rights and obligations among founders can be further defined through a members’ agreement. This agreement can be of significant importance, not only for standard joint business ventures but also for startups. In startups, investors on one side and founders on the other seek maximum protection against potential risks. In this context, the members’ agreement can make a difference by outlining and specifying the mutual rights and obligations between investors joining the startup’s ownership structure.
Another significant difference in the process of remote company formation in Serbia compared to standard company formation is:
5: Signing of the Articles of Association and submitting the Registration Application to the SBRA
As previously mentioned, it is possible to register a company in Serbia exclusively through online means. Starting from May 17, 2023, mandatory online registration of companies has been introduced, greatly simplifying and making the entire company formation process more efficient[1].
All documentation submitted to the Serbian Business Registers Agency (SBRA), as well as the company establishment resolution, must be in the form of electronic documents and supplied with a qualified electronic signature.
As the title suggests, this phase consists of two steps:
1. Signing the Articles of Association
The Articles of Association must be signed by the founders using a qualified electronic signature issued by an authorized certification body in Serbia. The requirement for a qualified electronic certificate implies that founders need to be personally present in Serbia to obtain the electronic certificate before the actual company formation. This can pose organizational challenges and incur additional travel and certificate issuance costs, especially when there are multiple founders.
An alternative solution is to rely on an attorney during the online company registration process. Attorneys are authorized to certify the authenticity of every original document they possess using their qualified electronic signature. This means that the attorney can convert each document into an electronic format, eliminating the need for founders to personally obtain an electronic certificate and be physically present in Serbia.
Therefore, the recommended step-by-step process for remote company formation would be as follows:
Option 1:
The founder would sign and have their signature notarized on the Articles of Association, as well as sign a general power of attorney authorizing the attorney to handle the registration procedure with the SBRA. The notarization of the signature on the Articles of Association can be done either abroad or in person in Serbia before a public notary.
This option can be useful for one or a small number of founders who do not wish to be physically present in Serbia during the establishment process. The main requirement for the first option of online company registration is the physical notarization of the founder’s signature on the Articles of Association by a notary.
Option 2:
The founder would sign and have a special power of attorney notarized, authorizing the attorney to sign and notarize the Articles of Association on their behalf with its electronic certificate or before a notary in Serbia. This option is particularly convenient when multiple founders are unable to be present for the notarization of the Articles of Association simultaneously. In this case, founders who do not wish to travel to Serbia can authorize an attorney in Serbia to attend the notarization on their behalf.
In both cases, the attorney is authorized to certify all the mentioned documentation with their electronic signature, thereby giving the necessary electronic form to the documents. Subsequently, the next step is company formation with the SBRA.
2. Electronic submission of the registration application to the SBRA
The electronic registration application also requires an electronic certificate. This means that the applicant must possess an electronic certificate. As previously mentioned, if you do not have an electronic certificate or simply prefer not to submit the registration application yourself, the attorney can do it on your behalf using their electronic certificate. Depending on the number of founders, whether they are domestic or foreign legal entities or individuals, and their physical location, it will be possible to determine the optimal step-by-step process for online company formation in each specific case.
Therefore, the great news for all company founders is that personalized access to online company registration is possible, allowing for maximum efficiency and minimized costs.
6: Opening a Company Bank Account
When the company is established, the Managing Director has to open a company’s bank account. For that purpose, the Managing Director has to sign the mandatory bank forms as well as documentation for opening the company bank account. In the process of remote company formation in Serbia, there are several ways to open a company’s bank account without the physical presence of the company’s Managing Director in the bank. Depending on the country in which the Managing Director resides, as well as depending on the bank itself, our legal team for company formation can further advise you which way is the most appropriate.
7: Obtaining the Electronic Signature of the Managing Director & Registration of the Ultimate Beneficial Owners
Considering that all newly established companies are required to register the beneficial owner within 15 days after the formation of the company, and substantial monetary fines are imposed for non-compliance, this requirement is the last but certainly not the least important.
To register the beneficial owner, the director must obtain an electronic signature from one of the authorized certification bodies in Serbia immediately after the company’s formation.
Following that, it is necessary to register the ultimate beneficial owner(s) (using the company director’s electronic signature) in the central register of beneficial owners with the Serbian Business Registers Agency.
These procedures are not demanding, especially considering that a legal team of experts in company formation can assist you at every step, resulting in significant time savings.
The motivation for foreign companies and individuals to establish a company in Serbia goes beyond low tax rates and attractive tax and state incentives. It also includes competitive company formation costs. An additional advantage is the opportunity for remote company formation, which is one of the significant reasons why you should start a business and invest in Serbia.
