SERBIA Trends and Developments Contributed by: Vera Davidović, Dušan Jablan, Uroš Rajić and Marko Jović, Gecić Law
practices and is partly driven by commitments under Serbia’s arrangement with the Interna - tional Monetary Fund (IMF). Under the new framework, SOE governance is being professionalised and depoliticised. Directors and board members of state-owned companies will be classified as public officials, subject them to stricter anti-corruption rules and transparency obligations. Article 18 of the Act presents various situations in which a busi - ness company owned by the Republic of Ser - bia must obtain government approval, reflect - ing a balanced approach between operational autonomy and state supervision for entities of strategic importance. This change reverses a 2021 interpretation that had weakened oversight and reestablishes accountability for those managing public assets. The revised provisions state that any acting director can only serve for a limited period, with a maximum cumulative duration. A qualified per - manent director must also be appointed through a transparent public competition within a speci - fied deadline. Serbia aims to ensure merit-based appointments and stable leadership in its state enterprises by closing this loophole. Additionally, the new Act strengthens boards of directors and introduces clearer responsibilities for SOE supervisory bodies. It includes meas - ures to prevent the misuse of public resources, especially around election cycles. Enhanced reporting requirements and performance moni - toring are being implemented, aligning with OECD Guidelines on Corporate Governance of State-Owned Enterprises. These legislative changes are expected to improve Serbia’s task ahead of time to enforce the new rules fully:
• appoint truly independent, qualified directors; • publish transparent financial results; and • subject SOEs to market discipline. Continued monitoring by international partners (EU, IMF, World Bank) is likely, given the impor - tance of SOE reform for Serbia’s fiscal health and EU accession prospects. Serbia’s state- owned enterprises are finally being brought under a modern governance regime. This should lead to more efficient public companies and a level playing field where private and public busi - nesses compete fairly, boosting overall econom - ic performance. Amendments to the Company Act In early 2025, the Serbian government adopted a Draft Act on Amendments to the Company Act that introduces more precise definitions and rules for cross-border corporate transforma - tions, aligning with EU standards. The legislation defines: • detailed procedures covering the drafting and publication of contracts; • reports from competent authorities and audi - tors; • registration requirements; • the legal consequences of these transactions; • the formation process; • management structure; • share capital requirements; and • procedures for converting a joint-stock com - pany into a European company; or • transferring its registered seat to other EU member states. The amendments introduce a harmonised frame - work for cross-border mergers with EU entities, eliminating the need for liquidation procedures. This reform aligns with Directive (EU) 2019/2121 on cross-border conversions and mergers. The
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