How to start a business in Serbia and get a residence permit?

In order to open a business in Serbia and obtain a residence permit (VNZh), you need to follow some basic guidelines:

1. Research the market. Determine what type of business would be most successful in Serbia. Consider factors such as demand, competition, and local laws.
2. Decide on the legal form. Choose the appropriate legal form for your business, such as LLC (LLC) or Joint Stock Company (JSC) or Individual Entrepreneurship (IE).
3. Business registration. Go through the procedure of registering a company in Serbia. This includes submitting the necessary documents to the relevant state authorities.
4. Opening a bank account. You will need to open a bank account for your business in a Serbian bank.
5. Obtaining permits and licenses. Depending on your business, you may need to get special permits or licenses.
6. Applying for a residence permit. Once your business has been successfully registered, you can apply for a residence permit. This usually requires proof of your business and financial stability.
7. Paying taxes and complying with legislation. Make sure you comply with all local tax and legal requirements.
8. Integration into the local community. Learn cultural sensitivities and language to more easily adapt and do business in Serbia.

Who can open a company in Serbia?

Along with locals, almost any foreign citizen or legal entity can open a company in Serbia, including citizens of other countries and representatives of international companies. Opening a business in Serbia for foreigners is a relatively simple and affordable process, which makes the country an attractive destination for international entrepreneurs and investors.

The following are the key aspects to consider when starting a company in Serbia:

Basic Requirements:

• Legal form. It is necessary to decide on the legal form of the company. In Serbia, the popular options are Limited Liability Company (LLC) and Joint Stock Company (JSC).
• Authorized capital. Opening an LLC requires a minimum authorized capital, which is quite symbolic - 100 dinars. For a joint stock company (JSC) in Serbia, the minimum authorized capital is 3 million Serbian dinars.
• Registration. It is necessary to go through the procedure of registering the company with the relevant state authorities. This includes the submission of constituent documents and registration with the tax service.
• Bank account. Opening a corporate bank account in one of the banks in Serbia.
• Legal address. The company needs to have a legal address in Serbia.
• Licenses and permits. Depending on the type of activity, special licenses or permits may be required.

Additional Aspects:

• Tax System. Understanding Serbia's tax system and compulsory tax deductions.
• Accounting. Maintaining accounting records in accordance with Serbian legislation.
• Local partners. Having local partners can make the process of doing business easier.
• Labor Laws. Compliance with local labor laws, including terms and conditions of employment of local and foreign employees.

Main organizational and legal forms in Serbia.

The choice of legal form of organization for opening a business in Serbia by a foreigner depends on a number of factors, such as the size of the business, the field of activity, future plans, the level of desired responsibility and the availability of capital.

Limited Liability Company (OOO, in Serbian Društvo sa limited ogogonošu or DOO):

• Minimum authorized capital: very low, only 100 dinars.
• Liability: participants are liable only to the extent of their contributions to the share capital.
• Governance: usually managed by a director who is appointed by the founders.
• Suitable for: small and medium-sized businesses, startups, individual entrepreneurs.

Joint Stock Company (JSC, in Serbian Aktionarsko društvo or AD):

• Minimum authorized capital: higher than that of an LLC - 3,000,000 RSD.
• Liability: shareholders are liable to the extent of their shareholdings.
• Governance: managed by a board of directors elected by the shareholders.
• Suitable for: large enterprises with a high volume of operations or those wishing to raise investment by selling shares.

Individual Entrepreneurship (IE, in Serbian Predzetnik):

• Minimum authorized capital: none.
• Liability: the entrepreneur has unlimited personal liability for all debts and obligations of his business.
• Management: the sole proprietor is the sole owner and manager of his business.
• Suitable for: small businesses where one person can manage all aspects of the business.

If you want to register a sole proprietorship or a company in Serbia and apply for a residence permit to open a business, by law you need to obtain a temporary residence permit (TPR) and a work permit after registering a sole proprietorship or an organization. The first step is to open a company/ sole proprietorship, the second step is to apply for a residence permit and the final step is to apply for a work permit.

Business Plan.

In order to apply for a residence permit (residence permit) in Serbia on the basis of starting a business, it is usually required to submit a business plan. A business plan plays a key role in this context, as it demonstrates to the Serbian migration authorities that you are serious, professional and ready to do business in the country. Here are the main points to consider:

• Detailed business description: your business plan should clearly describe the nature of your proposed business, including the products or services you plan to offer.
• Financial plan and projections: include detailed financial projections such as expected revenue, expenses, break-even point and plans for expansion.
• Marketing strategy: describe how you plan to attract and retain customers and your approach to advertising and promotion.
• Market analysis: include a market analysis that demonstrates knowledge of local conditions, competitors and potential customers.
• Organizational structure: describe the management structure of your business, including information about any partners or key employees.
• Contribution to the Serbian economy: show how your business will contribute to the local economy, for example through job creation or investment.
• Legislative compliance: make sure your plan complies with all local laws and regulations. The business plan should be realistic, well thought out and professionally written.

When preparing a business plan for obtaining a residence permit (TPL) based on opening a company in Serbia, it is important to consider the following elements of form and content:

Business Plan Form.

• Language. It is advisable to prepare the business plan in Serbian or provide a professional translation to simplify the process of document review by local authorities.
• Structuring. The business plan should be clearly structured, using headings, subheadings and lists for ease of reading.
• Professional layout. It is important that the document looks professional, with neat formatting, clear graphs and tables.
• Length of the document. A business plan should not be too long; 20-30 pages, including appendices, are usually sufficient.
• Electronic and hard copies. Prepare both an electronic version of the document and hard copies for submission to various authorities.

Content of the Business Plan.

• Executive Summary: A summary of key aspects of the business, including goals and mission, as well as key success factors.
• Company Description: A full description of the business, its principal activities, legal form, history (if applicable), location and management structure.
• Products or Services: A detailed description of the products or services offered, focusing on how they meet market needs.
• Market Analysis: market research including market size description, competitive analysis, target audience description, and growth potential.
• Marketing and sales strategy: plan for marketing and sales strategies, promotion channels and pricing.
• Operational plan: description of management processes, production, supply (logistics, warehousing and inventory management), etc.
• Organizational structure: information about the management team and key staff, their roles and responsibilities.
• Financial Plan: financial projections including start-up capital, projected revenues and expenses, break-even point, cash flow analysis and balance sheet.
• Risks and mitigation strategies: Assessment of potential risks and action plan to minimize them.
• Appendices: Important additional documents such as legal documents, contracts, licenses, patents, resumes of key personnel, licenses, etc.

A business plan for starting a company in Serbia is usually prepared for a period of three to five years. This period of time is considered standard for most business plans, as it allows for a fairly complete assessment of the business development potential, including the initial start-up phase, the establishment period, as well as anticipating long-term prospects and growth strategies.

Important Aspects:

• Short-term period (1-2 years): The focus here is on the start-up of the business, including initial investment, marketing, recruitment and initial sales. It is also important to consider expected initial difficulties and plans to overcome them.
• Medium-term period (3-4 years): This period focuses on business expansion, increasing sales volumes, optimizing operations and profit management.
• Long-term period (5 years or more): This describes strategies for further development, market expansion, potential innovations, and plans for sustainable growth and possible business expansion.

Why is such a deadline important?

• Demonstration of potential: a period of 3-5 years allows to show the potential of the business for long-term success, which is important for obtaining a business-based residence permit.
• Convincing: a long-term plan is more convincing to investors, lenders and migration authorities.
• Flexibility: a plan for this timeframe allows you to adapt to market changes and adjust strategies over time.

Additional Recommendations:

• Realistic: make sure your business plan is realistic and based on reliable data.
• Detail: the more detailed you describe each step, the better. This helps to prove your market awareness and readiness for different scenarios.
• Regular updates: the business plan should be reviewed and updated regularly to keep up with current market conditions and changes in the business.

It is also important to consider the specifics of your business and industry, as some activities may take longer to achieve stability and profitability.

The processing time of an application for a Serbian residence permit for starting a business is about 30 days. A residence permit is usually issued for one year with the possibility of extension. To apply for a residence permit you need to live in Serbia legally for 5 years. After 3 years in the permanent residence status you can apply for Serbian citizenship.