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BlogFREE ZONES IN BUSINESS

December 1, 2023

There are two ways of using the benefits of doing business within free customs zones on the territory of the Republic of Serbia.

The first way involves concluding a commercial contract with a company for the management of an already existing free zone, which further means using the free zone as a user under the conditions of the founder of the specific free zone and the company that was established to manage the specific free zone.

There are currently 15 free zones in the territory of the Republic of Serbia: free zone Subotica, free zone Pirot, free zone Zrenjanin, free zone Novi Sad, FAS free zone Kragujevac, free zone Šabac, free zone Uzice, free zone Svilajnac, free zone Smederevo, free zone Kruševac, free zone Apatin, free zone Vranje, free zone Priboj, free zone Belgrade, free zone Šumadija in Kragujevac.

Another way to use the benefits of doing business in a free zone involves the establishment of a new free zone by an interested legal entity. When establishing a new free zone, the primary issue is determining the geographic location where the free zone will be established. The selected location must be economically justified for designation as a free zone, which concretely implies that the competent ministry, based on all the circumstances of the specific case, must conclude that the designation of the selected area as a free zone would achieve positive effects in terms of attracting foreign capital, employment, transversal of modern technologies, etc. In order for this condition not to remain too broadly set, the Government of RS also adopted a special regulation that defines the situation when it is certainly considered that the condition of economic justification for the establishment of a new free zone has been met.

According to the provisions of the regulation, it is necessary to deal with the area where the airport is located, or it is the area in the immediate hinterland of the port, or the area is connected to main roads included in the network of European corridors, or the area is close to the railway line connected to the tran – the European road network, as well as to:

  1. the volume of investment related to the opening of the free zone exceeds the amount of 3 million euros, of which in the first year the amount of 1 million euros;
  2. the planned volume of production of goods and provision of services in the zone or related to the zone shows a positive effect on the foreign trade balance of the Republic of Serbia;
  3. the employment plan for all future users of the zone envisages employment of at least 100 persons in the first two years of operation of the zone;
  4. the planned procurement of means of production includes new equipment that is used to transfer modern technologies;

In the event that the criteria of economic justification are met, the additional obligation of the future founder of the zone is the establishment of a separate company for the management of the zone, in respect of which certain conditions must also be met:

  1. that the founder of the free zone management company is the same person who is the founder of the free zone itself (that is, the person who made the decision to establish the free zone should also be the founder of the management company);
  2. that the responsible person in the management company and the founding company of the free zone has not been convicted of certain criminal acts;
  3. that the person responsible for the management company was not a member of the management of another company that was liquidated in the last 3 years;
  4. that the founder of the free zone was not a member of another zone management company which.
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