Establishing a limited liability company in Serbia has become faster, more efficient, and adapted to the digital age. Since mid-May 2023, the procedure is exclusively conducted online (electronically), providing founders with essential flexibility and saving time and costs. Below, we will present the entire process of establishing and registering a limited liability company in Serbia in 2024.
I Registration of an LLC without the physical presence of founders – yes, it is possible!
In accordance with new regulations, establishing and registering a limited liability company ("LLC") in Serbia is now possible without the physical presence of founders. It is exclusively done electronically, which is most suitable for foreign founders and domestic citizens who want to save time and avoid administrative procedures and waiting in long lines.
If the founder possesses a qualified electronic certificate issued by a certification body in the Republic of Serbia (for simplicity, we will use the term "electronic signature" in this article), the entire process of submitting the registration application and signing founding documents can be completed entirely electronically by the founder. However, it is essential to emphasize that the electronic signature can only be obtained in person (there is no possibility of granting power of attorney), and this involves coming to the Republic of Serbia, if you choose this option. It is important to note that both domestic and foreign citizens obtain an electronic signature in the Republic of Serbia under the same conditions, and it must be obtained in person.
But don't worry! If the founder does not possess such an electronic signature, there is still the possibility to establish an LLC in the Republic of Serbia without their physical presence in the country, but this time with the assistance of an attorney at law. Of course, in the first case, the founder will most often turn to an attorney, but in this second scenario, it is vital. We present both options below.
II Steps for establishment
a. First note – choosing a business name
Before you embark on the actual procedure, it is crucial to check whether the business name you have chosen is available for use, i.e., whether it is not already taken or too similar to the business name of an existing company. This is of great importance because the registrar will reject the registration application if the business name does not meet this condition. This can be easily prevented through a search of registered economic entities available on the website of the Business Registers Agency ("BRA").
What is considered different enough, as well as the other conditions your company's business name must meet (related to the use of specific words, names, etc.), is precisely defined by the BRA. It is necessary to familiarize yourself in advance with these rules, which are available on their website.
b. Submitting the registration application electronically
As mentioned, it is no longer possible to submit a registration application physically; this is now exclusively done electronically through the BRA application. Starting from January 1, 2024, you can log in to the BRA application only through an account created on the eID.gov.rs portal (the portal for electronic identification of citizens).
Once logged into the BRA application, you will choose the option for a business entity, create a request for establishing an LLC, and then follow the subsequent steps. It is crucial to carefully enter all the details during the process, as an error could lead to the rejection of the application or the registration of incorrect information. In such cases, you might have to go through the entire process of submitting an application to correct the inaccurate data, and this process also incurs fees and takes some time.
If you want to personally carry out the entire procedure without engaging an attorney at law, this implies that you possess an electronic signature and all the documentation in electronic format (for specifics regarding documentation, read further in the text). After completing all the details and attaching the necessary documentation, you will need to make an electronic payment for the calculated fee. Following this, you will have to sign the application with your electronic signature.
EXAMPLE | The founder is a natural person who possesses an electronic signature issued by an authorized certification body in Serbia. |
OPTION A: | The founder signs the founding act and registration application with their electronic signature. There is no need to notarize any document (signature). |
OPTION B: | The founding act is signed in paper form. In this case, the signature on the founding act must be notarized by a notary public, and it must be digitized by the notary public as well, after which the founder submitts the registration application and signs it with their electronic signature. (Alternatively, an attorney at law can digitize the document instead of a notary, but in that case, the attorney must also submitt the registration application, not the founder). |
Although the intention behind introducing electronic registration was to simplify the procedure and reduce administrative burdens, due to conditions regarding documentation, possession of an electronic signature, and other difficulties, the process of registering an LLC has, for many, actually become more complicated. For this reason, the BRA has granted attorneys the authority to take the necessary steps on your behalf. In this case, the application process is as follows:
The founder(s) need to grant power of attorney ("PoA") to the attorney at law, for submitting the application. Based on this PoA, the attorney will carry out all the necessary steps for submitting the application. In this case, the founder(s) can provide the documentation either in electronic form (signed with the electronic signature of the signatory) or in paper form, in which case the lawyer will digitize it and submit it with the application.
What does this mean? Regarding the founding act, if you have an electronic signature, it is sufficient to electronically sign and send it to the attorney. If you do not have an electronic signature, you must sign the founding act, and then the signatures must be notarized by a notary public. The original documents in paper should be provided to the attorney, who will then digitize and submit them with the application. If the founders are located outside of Serbia, the signatures on the document will also need to be authenticated by the competent authority of that country. Additionally, they must meet other relevant requirements, which vary depending on the specific country (more details in Option A described below).
Regarding other documents, please refer to point d.
EXAMPLE | The founder does not possess an electronic signature issued by an authorized certification body in Serbia. |
OPTION A: | The founder signs a PoA for the attorney, who submits the registration application. This PoA is not notarized. The founder signs the founding act and gets the signature notarized by a notary public (if the signature is notarized in a foreign country, it requires either full legalization or apostille in most cases, except in exceptional cases (countries that have specific bilateral agreements with Serbia), and a translation to Serbian language if the document is in a foreign language). The attorney digitizes these documents and submits them with the application. |
OPTION B: | The founder signs a special PoA for the attorney and notarizes the signature on it (if it concerns a foreign country, the same rules apply as mentioned above). Based on this PoA, the attorney will electronically sign the founding act on behalf of the founder, and submit the registration application. |
c. Founding act
To establish an LLC, you need to draft a founding act that regulates the future organization and operation of the company, the rights and obligations of members, the authority of company bodies, and other crucial issues. This document is signed by the founder(s) - in the case of multiple founders, it is referred to as the Agreement on Establishment, and If there is a single founder, it is called the Decision on Establishment.
Before the introduction of electronic application for establishing an LLC, signatures on the founding act had to be notarized by a notary public. Now, this step can be omitted, but only if the founders have the electronic signatures mentioned earlier. In this case, it is sufficient for the founders to electronically sign the founding act and submit it to the BRA in the process of submitting the registration application.
If the founder(s) do not have an electronic signature, they can grant special PoA to the attorney (who submits the registration application) to sign the founding act on their behalf using their electronic signature. However, the signature on the special PoA must be notarized by a notary public or another competent authority. Given that the signatures on the special PoA must be notarized, in this case, the founders can still choose to sign the founding act on paper. In this scenario, it is necessary for them to have their signatures on this document notarized by the competent authority (if done outside of Serbia, the document must be either fully legalized or apostilled, or notarization alone may be sufficient, depending on the country). These documents will then be digitized, i.e., signed with an electronic certificate by the attorney submitting the registration application for establishment (together with the translation, if the documents are not in Serbian or billingual).
d. Rules regarding documentation
Just like with the founding act, in the new procedure for establishing an LLC, every document must be created in electronic form or digitized by an authorized person. What does this mean?
If the document was not originally created in electronic form but exists in paper form, it needs to be converted into electronic form and "authenticated" by the signature (or seal) of one of the following individuals:
a. The entity that issued the document (for example, a certificate obtained from a government authority will be authenticated by an authorized individual),
b. A notary public, or
c. An attorney, who, in this case, must be the one submitting the registration application (based on the PoA you will sign).
If the document is in a foreign language, it is additionally necessary to provide a translation to the Serbian language by an authorized interpreter. If the translation is in electronic form (with the electronic signature of the authorized translator), there is no need to digitize it. However, if the translation is in paper form with the translator's signature, it needs to be digitized and "authenticated" in the manner described above.
For documents that require notarization and have been notarized in a foreign country, the document first needs to undergo the legalization process (whether through "full" legalization or obtaining an apostille, or none of the above depending on the country). Afterward, the document will be digitized by an authorized person, which, in this case, could be either a notary public or an attorney.
Lastly, it's important to note that even if you have the document in electronic form, if it was issued in a foreign country, presenting it in that format will not be sufficient. In this case, the document needs to be printed, confirmed as a faithful copy by the foreign authority responsible for authentication, and then digitized in the manner described above.
e. Registration of the Beneficial Owner
Another essential step in the process of registering an LLC is the registration of the beneficial owner. The beneficial owner is a natural person who ultimately owns or controls the company. The legal representative of each newly established LLC is obliged to register the beneficial owner within 15 days of successful registration with the BRA.
However, starting from October 1, 2023, this process has been simplified with the introduction of a new option: it is now possible to register the beneficial owner simultaneously with the submission of the electronic registration application for the establishment of the company. However, what is specific in this case, as confirmed to our office in writing by the BRA, is that this option is available only when the founder personally submits the registration application, but not when the application is submitted by an authorized representative (which includes attorneys) on their behalf.
This means that if the registration application is submitted by an attorney, the legal representative of the company (director) will still need to register the beneficial owner after the succesful registration (for which an electronic signature is required). However, for foreign founders, this does not imply the need to come to Serbia since only the legal representative needs to have an electronic signature for this purpose, not the founder. Only in cases where the founder also acts as the director of the company would the founder need to come to Serbia and obtain an electronic signature (in which case, it is easiest to do this before the start of the establishment process).
f. Opening a bank account and depositing the founding capital
Every LLC must have a certain founding capital that is contributed to the company. In the case of an LLC, this is a minimum amount, as the founding capital can be as low as 100 RSD (which is the legally prescribed minimum).
Although it is possible to deposit the founding capital before the registration of the company (by opening a dedicated account from which the funds will be transferred to the company's regular account after its opening), this is often seen as an unnecessary additional step since the founding capital can be deposited within 5 years from the date of the company's registration. In this sense, the most common order of steps is to deposit the founding capital after the registration of the company, since opening the company's bank account after its registration is a mandatory step.
The steps and necessary documentation for opening a company's bank account vary depending on the bank you choose and other circumstances, and they can change (they are not universal or constant). Therefore, it is essential to inquire about this with the chosen bank directly before the company is established or consult with your attorney who can handle this on your behalf.
If you have further questions, feel free to contact us at: office@r-legal.net.
Note: The information provided in this article is solely for informational purposes and does not constitute legal advice.
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