Establishing Associations, Foundations, and Other Forms of Organizations in Serbia

If you’re a foreign investor or individual looking to establish associations, foundations, or other forms of organizations in Serbia, the process is structured, transparent, and offers several benefits. The legal framework in Serbia encourages foreign participation, providing an attractive environment for non-governmental organizations (NGOs), nonprofits, and similar entities.

Types of Organizations You Can Establish in Serbia

1. Associations: Associations are the most common type of non-governmental organizations. They are typically founded for non-profit purposes, such as promoting social, cultural, educational, or humanitarian objectives.

1. • Minimum of three founders required.
   • Can be established by both individuals and legal entities, whether local or foreign.
   • Associations are governed by the Law on Associations.

2. Foundations: Foundations are established to manage property or assets for a specific purpose, such as supporting education, health, or cultural development.

1. • Require a founder’s act and initial capital.
   • Governed by the Law on Endowments and Foundations.
   • Can be established by foreign individuals or organizations.

3. Endowments: Similar to foundations but with stricter requirements regarding capital and asset management, endowments are also set up for charitable or non-profit purposes.

                                                                                                                            Key Steps for Establishing an Association or Foundation in Serbia

1. Choosing the Organizational Structure: The first step is to decide on the type of organization you want to establish (association, foundation, or other forms).

1. • Associations are the simplest structure for small, local or international initiatives.
   • Foundations and endowments are ideal for those aiming to support larger charitable goals.

2. Drafting the Founding Document: A key requirement is the drafting of the founding document (statutes or articles of association). This document outlines the mission, objectives, and governance structure.

1. • For associations, a minimum of three founders is required.
   • For foundations, a founding act outlining the purpose and initial capital is necessary.

3. Registration at the Business Registers Agency (APR): Once the founding document is drafted, it needs to be submitted to the Serbian Business Registers Agency (APR). The registration process typically includes:

1. • Founding document.
   • Proof of identity of the founders (passport for foreign individuals).
   • Proof of a registered address in Serbia.
   • Appointment of representatives or directors.

4. Obtaining a Tax Identification Number (PIB): After registration, the organization must obtain a Tax Identification Number (PIB) from the Serbian Tax Authority. This is necessary for tax filings and financial transactions.
5. Opening a Bank Account: The organization needs a bank account with a Serbian bank to manage donations, grants, or any other financial assets.

                                                                                                                      Legal Obligations and Compliance

• Taxation: Most non-profit organizations benefit from tax exemptions, but they must still comply with certain tax obligations. It is advisable to consult a local accountant or law firm to ensure compliance with all regulations.
• Accounting Standards: Organizations must maintain accounting records in line with Serbian laws. This includes annual financial reporting.
• Licensing and Permits: Depending on the organization’s activities, additional permits or licenses may be required. This is especially relevant for sectors like education or healthcare.

                                                                                                            Incentives for Foreign Founders

Serbia provides an encouraging climate for foreign founders of NGOs and non-profit organizations:

• Favorable tax policies, especially for organizations with charitable or non-profit aims.
• Access to international grants and cooperation programs.
• Simplified procedures for registration and operation.
• Strategic geographical location for initiatives targeting both European and non-European markets.

                                                                                                                    Conclusion

Establishing an association or foundation in Serbia offers significant opportunities for foreign individuals and organizations looking to contribute to social, cultural, or humanitarian causes. With a clear and efficient registration process, tax benefits, and the support of professional legal services like Dulić Law Office, setting up your organization can be a smooth process. Our law firm provides comprehensive services in drafting founding documents, managing tax obligations, and ensuring legal compliance, with multilingual lawyers fluent in English and French.