Apr 7, 2017

Source: www.lawinserbia.com

Serbia has a civil law system, which means that law is codified, so courts solely interpret legislation rather than being bound by precedent (rule established in a previous legal case). Thus, there is no doctrine of precedent.

Legislative Framework

The Parliament is the supreme legislator. Certain bodies with executive powers, such as the government and ministries, are competent to pass decrees and by-laws in specific areas, though they must be in compliance with parliamentary legislation. These instruments only come into force after publication in the Official Gazette of Serbia.

Courts

The organization of the court system in Serbia and jurisdiction of courts is regulated by the Law on Organization of Courts, applicable as of 1 January 2010. The court system consists of the Constitutional Court, courts of general jurisdiction and courts of special jurisdiction.The following organizational chart outlines the courts structure.

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The Constitutional Court decides on the constitutionality and legality of laws and by-laws, as well as protects human and minority rights and freedoms. Basic courts are courts of first instance and are established to cover one or more municipalities. Higher courts are established to cover the territory of one or more basic courts and are also courts of first instance, while in limited numbers of cases they act as courts of second instance to basic courts. Commercial courts adjudicate commercial matters, with the Commercial Appeal Court being the second instance court for these matters. Appeal courts are second instance courts to both basic and higher courts (except in limited number of cases when higher courts act as second instance courts to basic courts), Supreme Cassation Court is the highest court in Serbia and is competent to decide on extraordinary judiciary remedies and conflicts of jurisdiction.

Misdemeanor courts are second instance courts for misdemeanors ruled by state authorities in first instance, as well as first instance courts for misdemeanors for which state authorities are not competent in the first instance. The Administrative Court is competent for adjudicating in administrative disputes.

Freedom of Contract

Parties to a contract are free to decide which substantive law shall govern the contract and the law of Serbia does not have to be governing law of a contract entered into in Serbia.

The most important laws and regulations regarding investment in Serbia, and those governing business activities and dealings of foreign companies in Serbia include:

  1. Foreign Investment Law;
  2. Law on Foreign Trade;
  3. Law on Foreign Exchange Operations;
  4. Law on Markets of Securities and other Financial Instruments;
  5. Company Law;
  6. Law on Registration of Commercial Entities;
  7. Law on Banks and Other Financial Institutions;
  8. Regulations on Conditions for Establishing and Operation of Foreign Representative Offices in Serbia;
  9. Law on Financial Leasing;
  10. Law on Concessions; and
  11. Law on Privatization.

The above laws set out the basic rules foreign companies must comply with if they wish to establish subsidiaries in Serbia, invest in local companies, open representative offices in Serbia, enter into agency agreements for representation by local companies, acquire concessions for the exploitation of natural resources and participate in the privatisation process in Serbia.

Arbitration – The Future in Serbia?

Since in certain cases it may take several years to receive a final judgement, many business entities opt for contractually obligated arbitration. There is a Foreign Trade Court of Arbitration at the Serbian Chamber of Commerce in Belgrade. It is international, general (all conflicts arising from international business relations are considered), open (domestic and foreign citizens are on its list), independent and autonomous. Its judgments are final. Specific rules of procedure can be agreed between the parties and specialist arbitrators can be chosen. It is likely that the United Nations Commission on International Trade Law (UNICITRAL) book of rules may be applied.