Company formation in Serbia in 2026 involves a range of legal, tax, and organizational decisions that can significantly impact a business’s long-term success. 

In recent years, Serbia has been recognized as an attractive destination for establishing companies, particularly in the IT sector, service industries, and manufacturing. This trend is driven by relatively low operating costs, a favorable tax framework, and an available workforce.

Serbia is often described as a “mid-shore” jurisdiction – neither a classic offshore zone nor part of the European Union, with high tax rates and heavy fiscal burdens.

Company formation is possible in various legal forms, which makes it essential to consider all relevant factors to choose a structure aligned with the founders’ objectives and the planned business model. 

This brief guide provides a clear and practical overview of the basic steps in the company formation process in Serbia and is intended for those considering entering entrepreneurship in an informed, secure, and legally structured manner.

Who can be a founder?

A company in Serbia may be established by any natural person or legal entity, domestic or foreign, regardless of citizenship. 

Serbian regulations do not distinguish between domestic and foreign founders, nor do they impose special conditions or restrictions based on the country of origin. 

Both the founder and the legal representative (director) of a company may be foreign nationals, in various combinations. 

Any company registered in the Republic of Serbia is considered a Serbian legal entity, regardless of its ownership structure.

In practice, it is common for both the founder and the director to be foreign nationals (for example, citizens of the United States, China, or Germany), as well as for the founder to be foreign and the director a Serbian national. 

Such structures are often chosen when the founder does not plan to be physically present in Serbia, and a locally based director is appointed to handle day-to-day operations and represent the company before domestic authorities. 

At the incorporation stage, there is a high degree of flexibility in assigning roles; however, certain statuses may trigger the obligation to obtain temporary residence and work permits in Serbia, as well as a qualified electronic certificate. 

Timely planning of these matters significantly facilitates subsequent business operations.

Owing to this legal framework, company formation in Serbia represents an accessible and attractive option for a wide range of domestic and foreign investors. 

In recent years, there has been a steady increase in foreign investment, along with a growing number of newly established companies and sole entrepreneurs.

The personal presence of the founder is not required for incorporation. The procedure may be carried out electronically, through an authorized representative empowered to conduct the registration process.

Types of business entities in Serbia

Choosing the appropriate legal form is one of the key decisions when establishing a company, as it directly affects the founders’ liability, tax treatment, operating costs, and future development opportunities. 

The Serbian Companies Act recognizes four basic forms of business entities:

1. General Partnership (Ortačko društvo – OD) consists of two or more partners who are jointly and severally liable without limitation for the obligations of the partnership. All partners are authorized to represent the partnership, and new partners may join after incorporation, assuming the existing rights and obligations.
2. Limited Partnership (Komanditno društvo – KD) has at least one general partner (komplementar) who manages the business and bears unlimited liability, and one or more limited partners (komanditori) whose liability is limited to the amount of their contributions. This form is often viewed as a hybrid between a general partnership and a limited liability company.
3. Joint-Stock Company (Akcionarsko društvo – AD) is intended for larger business systems and investment ventures. Shareholders are not personally liable for the company’s obligations, and the statutory minimum share capital is RSD 3,000,000.
4. Limited Liability Company (Društvo sa ograničenom odgovornošću – DOO) is the most common form of business entity in Serbia. Members are not personally liable for the company’s obligations, the minimum share capital is RSD 100, and the management structure is flexible both at the incorporation stage and during ongoing operations.

A sole proprietorship (entrepreneur / preduzetnička radnja) does not have the status of a company. This form is particularly suitable where there is a single business operator and the objective is a simpler, faster, and more cost-efficient registration process. 

Registration does not create a separate legal entity; the individual entrepreneur conducts the business and is personally and unlimitedly liable with all personal assets. 

It offers the highest level of flexibility and the lowest registration and operating costs and is, alongside the DOO, one of the most common forms of doing business in Serbia.

Limited Liability Company (Društvo sa ograničenom odgovornošću – DOO)

The incorporation of a limited liability company begins with the preparation and notarization (or electronic signing) of the founding act, which takes the form of a resolution if there is a single founder, or an agreement if the company is established by two or more persons. 

The founding act must contain all elements prescribed by law, which makes its proper drafting particularly important in order to avoid formal deficiencies and possible rejection of the registration application.

A DOO may be established by one or more natural or legal persons, domestic or foreign. 

The minimum share capital is RSD 100. The amount of share capital is stated in the founding act and the registration application, while the contribution may be paid no later than five years from the date of adoption of the founding act.

Depending on its organizational structure, a DOO may operate under a one-tier or two-tier management system: 

• The one-tier model includes the shareholders’ assembly and one or more directors, with the sole member performing the function of the assembly in a single-member company. 
• The two-tier model, in addition to these bodies, includes a supervisory board.

Unlike a sole proprietorship, a DOO must have a registered business name. The company name must be unique and clearly distinguishable from the names of other business entities registered with the Serbian Business Registers Agency, in a manner that excludes any risk of confusion as to identity. 

Generic terms are not considered sufficient differentiation, and the use of certain words, such as the names of the state or territorial units, is subject to statutory restrictions and prior approval of the competent authorities.

Members of a DOO hold ownership interests in the company and, as a rule, are not personally liable for the company’s obligations beyond the value of their contributions. 

Exceptions to this principle are prescribed in cases of piercing the corporate veil and in certain procedures of compulsory dissolution, where members’ liability may be significantly extended.

The incorporation of business entities in Serbia is currently conducted exclusively in electronic form, through the portal of the Serbian Business Registers Agency.

Sole Proprietorship (Entrepreneur – Preduzetnička radnja, PR)

One of the main advantages of establishing a sole proprietorship is the simplified procedure and minimal documentation requirements. 

Unlike companies, no founding act is required; registration is completed based on the founder’s identification document and a properly completed registration application. 

There is also no requirement to pay share capital, which makes this form of business simple and financially less demanding.

An entrepreneur does not operate under a separate company name in the classical sense. The full business name consists of the entrepreneur’s first and last name, a description of the business activity, and the place of business. 

The key difference compared to a DOO lies in liability: the entrepreneur is fully liable for all business obligations with his or her entire personal property, including private assets.

From a tax perspective, entrepreneurs may choose between different taxation regimes. It is possible to opt for lump-sum (flat-rate) taxation or for keeping full accounting records. 

Each system has its advantages and limitations, which makes a prior analysis of the planned business activity, expected income, and long-term goals particularly important.

An additional feature of a sole proprietorship is the possibility to register the business without simultaneously reporting the commencement of activities. In that case, the business is formally registered but does not operate, and taxes and social contributions are not due until the start of activities is subsequently reported. 

It is also possible to register a temporary suspension of activities, during which tax obligations are likewise suspended, which is particularly suitable for seasonal businesses.

Remote incorporation: Is it possible to establish a company in Serbia without the presence of the founder?

Company formation in Serbia is possible even when the founder is not physically present in the country. Both limited liability companies and sole proprietorships may be established without the founder’s personal presence. In practice, remote incorporation of a sole proprietorship is significantly simpler, while the incorporation of a DOO involves additional formal requirements.

When a DOO is established from abroad, the founder must sign and notarize the founding act in the foreign country, together with the required form of international legalization, depending on the country where the document is issued. 

It is recommended, where possible, that notarization be carried out at a diplomatic or consular mission of the Republic of Serbia, as this avoids the need for additional legalization and certified translation. 

If the document is notarized before a foreign authority, it must subsequently be delivered to Serbia and translated into Serbian by a certified court interpreter.

Alternatively, a DOO may be established through a representative in Serbia, most commonly an attorney-at-law, who signs and notarizes the founding act before a Serbian notary public. 

In such cases, the founder must previously execute and notarize a special power of attorney authorizing the representative to undertake all actions in the incorporation process, including the adoption of the founding act on behalf of the founder.

Before registration, it is necessary to make several key business and legal decisions, in particular:

• choosing the legal form

• defining the organizational structure

• selecting the business name and registered office

• determining the principal business activity

• appointing the director
• deciding on the amount of share capital and the tax model

• selecting a bank and an accounting service provider

• preparing and notarizing the founding act

The registration application is submitted by a person authorized by a power of attorney, either electronically or in person at the premises of the Serbian Business Registers Agency. 

Once a complete application has been filed, the registration decision is, in practice, issued within three to five business days.

The fee for registering a sole proprietorship is RSD 2,500 when the application is submitted in paper form. The fee for electronic registration of a company is RSD 8,000.

Steps after incorporation 

1. Director’s qualified electronic signature

One of the key obligations after a company is incorporated is obtaining a qualified electronic signature for the director. 

An electronic signature is a fundamental tool in modern business operations, as it enables numerous legal and administrative actions to be performed electronically, as well as the fulfillment of obligations toward state authorities. 

Certain filings, submissions, and financial statements may be submitted exclusively in electronic form, which makes a qualified electronic signature indispensable.

In practice, the director often authorizes the accountant to use the electronic signature to submit filings and reports on behalf of the company.

A qualified electronic signature is obtained from authorized certification bodies for the issuance of qualified electronic certificates in the Republic of Serbia, upon submitting an application and paying the prescribed fee. The certificate is typically issued within a few days, and collection is performed in person only.

2. Registration of beneficial owners

One of the basic obligations after establishing a limited liability company is the registration of beneficial owners within 15 days from the date of incorporation, in accordance with the regulations governing the Central Register of Beneficial Owners maintained by the Serbian Business Registers Agency. 

This obligation can only be fulfilled after obtaining an electronic signature.

Failure to register beneficial owners entails significant legal consequences, including misdemeanor liability and, in legally prescribed cases, potential criminal sanctions.

3. Opening a business bank account

After the registration decision has been issued, the electronic signature obtained, and the beneficial owners registered, it is necessary to open a business current account with a bank of choice. 

The account is generally opened in person by the legal representative of the company, while opening an account through a proxy has, in recent years, become significantly restricted and, in practice, largely unavailable.

The documentation required for opening a bank account depends on the internal policies of the specific bank, but in practice, it most commonly includes:

• the registration decision of the Serbian Business Registers Agency

• an identification document of the director or legal representative

• certified signatures of authorized persons (OP form) and a specimen signature card

If the founder is a legal entity, banks typically require additional documentation. 

This most often includes an extract from the relevant foreign register showing the ownership and management structure, information on shareholders and directors, as well as documents identifying the ultimate beneficial owner. 

It is also standard practice to require certified identification documents of the founders, most commonly passports.

Branch of a foreign company

A branch of a foreign company is a separate organizational unit through which the foreign company conducts business activities in Serbia. 

The branch must have a registered principal activity and may simultaneously perform any other activities not prohibited by law, regardless of whether they are explicitly stated in the decision on the establishment of the branch. 

A branch does not have the status of a legal entity, but for tax purposes, it is treated as a resident.

What is a virtual address and when is it used?

Every company and every sole proprietorship must have a registered office. 

In practice, many business activities do not require the lease of dedicated office space (for example, consulting, IT, or educational services, or activities that do not require a fiscal cash register). In such cases, the use of so-called virtual offices has become increasingly common.

Virtual office services are provided by specialized companies that, for a fee, allow businesses to register their seat at the provider’s address. In addition to the address itself, these services may include receipt of mail and official correspondence, as well as basic administrative support. 

This model makes it possible to secure a properly registered office and a reliable location for receiving official communications at relatively low cost, without the need for physical office premises.

Company formation: Can foreign citizens establish a company in Serbia?

The legal framework of the Republic of Serbia allows foreign nationals to act as founders and directors of companies, as well as to register sole proprietorships, without restrictions related to citizenship or place of residence at the time of incorporation. 

A company registered in Serbia is considered a domestic legal entity regardless of its ownership structure.

Company formation must be clearly distinguished from the right to reside and work. 

Registration of a company or sole proprietorship in itself does not grant the right to stay or work in Serbia. 

If a foreign national intends to reside in Serbia or to actively perform work within the company (as a director, entrepreneur, or employee), temporary residence and the appropriate work authorization must be obtained, most commonly based on self-employment or employment.

In practice, establishing a company is one of the most common legal grounds for obtaining temporary residence and a unified residence and work permit. 

In such proceedings, the competent authorities particularly assess the genuine business purpose, the planned activity, and the qualifications of the foreign national, which is why documentation proving professional competence and a connection between the applicant and the registered activity is regularly required.

Special attention in cases involving foreign founders is also required in the post-incorporation phase, particularly in connection with opening a bank account and compliance with anti-money laundering regulations.

Banks typically conduct enhanced due diligence regarding ownership structure, source of funds, and the business model, which can make the procedure significantly more complex compared to domestic founders.

Due to the simultaneous interaction of corporate, immigration, tax, and banking regulations, company formation by foreign nationals requires a predefined structure and precise legal planning in order to ensure that incorporation, residence, work authorization, and subsequent business operations are properly aligned and sustainable.

Lawyer’s advice for the end

Company formation in Serbia is a relatively quick and accessible procedure, but wrong decisions made can have long-term legal, tax, and financial consequences.

The choice of legal form, company structure, tax model, and management method should not be seen as a technical issue, but as a strategic decision that directly affects the security and sustainability of the business.

In practice, the most frequent mistakes are made precisely because of an attempt to simplify or speed up the procedure without looking at the bigger picture. What is cheaper and faster at the start often turns out to be a more expensive and complicated solution later.

That is why it is recommended that a detailed legal analysis of the planned business be carried out before registering the company.

Timely advice from a lawyer allows the structure to be set up correctly from the start and to avoid problems that are difficult or expensive to correct later.

If you need legal help or advice, contact us and schedule a consultation.

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