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Serbian Citizenship by Investment – New Possibility on the Horizon?


According to recently published news, Serbian authorities contemplate about enacting legislation that would allow foreign citizens to obtain Serbian citizenship by investment into Serbian economy. This option is not currently explicitly mentioned as a way of naturalization of foreign nationals in Serbia, since the Citizenship Law prescribes that Serbian passport can be obtained only by:

  • Origin
  • Birth on the Serbian territory
  • Naturalization
  • In accordance with international treaties.[1]

Even though the Law does not explicitly stipulate a possibility to acquire citizenship via investment, it actually makes that option available to foreign applicants. Namely, Serbian citizenship request may be granted to a foreign citizen whose naturalization is in the Republic of Serbia’s interest. The decision on what constitutes “interest of the Republic of Serbia” is made by the Serbian Government.[2] Therefore, the authorities may conclude that certain foreign investments are of special importance to national interests, due to which they would be inclined to grant the citizenship request. However, no precise criteria exist for determining what is in the Republic of Serbia’s interest, and this is decided on a case-by-case basis. Interests of the Republic of Serbia for foreign citizen’s naturalization may be of economic, scientific, cultural or sports nature.[3] Therefore, foreign investors face uncertainty whether their citizenship application will be successful. By enacting aforementioned new legislation, precise criteria could be established, thus improving investors’ position.

The possibility to obtain citizenship by investment in destination countries is widespread throughout the world, existing in 22 countries.[4]

Based on the experience of the existing programs that exchange residence rights or citizenship for investments, motivations behind the investors’ desire to obtain foreign citizenship include gaining greater access to visa-free travel and the establishment of residence in low-tax jurisdictions. Another reason for which investors intend to obtain another country’s citizenship is to ensure themselves in case political or economic changes occur in their homeland in the future. On the other hand, new job opportunities are created in destination countries or they may have other financial interests. Possible additional benefits for destination countries may include the introduction of novelties and new technologies in the destination country.

To foreign investors, Serbia can offer both favorable tax regime and visa-free travel, since its income tax on capital rate amounts to 15%[5] and Serbia maintains visa-free regime with 138 countries.[6] Among those travel regimes, the ones especially worth mentioning are with the EU Schengen States, China and Russia.

In addition to citizenship, immigrant investor programs may provide a possibility to obtain permanent residence permits instead of citizenship. As of now, the Serbian Law on Foreigners prescribes a possibility for a foreigner to obtain a permanent residence permit without spending a necessary period in Serbia “if that is in the interest of the Republic of Serbia”[7]. Therefore, the same ground is applicable both for citizenship and for permanent residence permit. However, both laws are construed rather narrowly by Serbian authorities at this point.

Until enacting legislation that would allow foreign citizens to obtain Serbian citizenship by investment, some kind of transitional period may be provided by more flexible and consistent interpretation of the Law on Foreigners for certain types of investments, whereby particular investors would have been granted permanent residence under favorable conditions.

Worldwide, immigrant investor programs can be categorized as follows:

  • Investments in the private sector (the aim is to generate new job openings by stimulating foreign investments)
  • Investments between the investor and the government (the aim is to increase government revenues)

According to this categorization, it is most likely that, if enacted, Serbian legislation would provide the Serbian passport by investment to be reached through one of these options.

Finally, in order to ensure the integrity of the program and reduce the risk of abuse, destination countries run background checks to inspect whether investor’s financial means come from a legal source and whether they have a criminal record. Prior to finding in favor of investor’s application, it is most likely that the Serbian Ministry of Interior along with its Ministry of Foreign Affairs would be in charge of conducting these inspections.

Nevertheless, before enacting such legislation, many open questions need to be answered. How much money or other financial assets will foreigners have to invest in Serbia in order to qualify for the program? Over which period of time? Will there be a requirement for them to spend a certain period of time in Serbia before applying for citizenship? How many job openings will their investments be required to create?

Until that happens, foreign investors will have to either follow traditional routes or they would have to prove that granting them citizenship is “in the interest of the Republic of Serbia”, without knowing the precise criteria which constitute this ground.

[1] Citizenship Law (“Official Gazette of the RS”, No. 135/2004 and 90/2007), Article 6
[2] Ibid, Član 19
[3] goo.gl/XyS8n9
[4] https://www.paragraf.rs/dnevne-vesti/051017/051017-vest10.html
[5] Income tax on capital Law (“Official Gazette of the RS”, No. 24/2001, 80/2002, …), Article 64
[6] http://serbiancitizenship.com/citizenship/visa-free-countries/
[7] Law on Foreigners (“Official Gazette of the RS”, No. 97/2008), Article 37, paragraph 2

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