Business branch in Serbia

An Overview of the Serbian Foreign Exchange Operations Act

October 26, 2017 by Nebojša Stanković

In the following overview of the Serbian Foreign Exchange Operations Act, you will find out what this particular law actually governs, as well as what its most important stipulations are.

The Serbian Foreign Exchange Operations Act governs the following:

  1. payments, collections and transfers between residents and non-residents in foreign currencies and in dinars;
  2. payments, collections and transfers between residents in foreign currencies;
  3. purchase and sale of means of payment between residents and nonresidents;
  4. purchase and sale of foreign currencies between residents;
  5. unilateral transfers of means of payment from and into the Republic of Serbia which do not have the characteristics of transactions between residents and nonresidents;
  6. current and deposit accounts of residents abroad and residents and non-residents in the Republic of Serbia;
  7. credit operations in foreign exchange in the Republic of Serbia and foreign credit operations.

Residents include:

  1. legal entities registered and headquartered in Serbia;
  2. entrepreneurs who, as natural persons, are registered in Serbia and who are pursuing a legally-permitted activity as a profession with the purpose of making profit;
  3. branches of foreign legal entities registered with the competent authority in Serbia;
  4. natural persons residing in Serbia (except for those residing abroad for over a year);
  5. natural persons who are foreign citizens residing in Serbia for over a year due to a residence permit or work visa;
  6. beneficiaries of the budget funds of Serbia, of the funds of mandatory social insurance organizations, of the budget funds of local government, and other public funds beneficiaries who are included in the consolidated treasury account system;
  7. diplomatic, consular, and other representative offices abroad, financed from the budget of the Republic of Serbia, as well as domestic citizens working in those offices and their family members;
  8. banks, as joint-stock companies headquartered in Serbia, with an operating licence granted by the National Bank of Serbia.

Non-residents are all other persons not included above.

Money

Means of payment are dinars and foreign means of payment (foreign exchange and foreign cash), while payment instruments are cheques, bills of exchange, letters of credit, remittances, payment cards, and other payment instruments.

Current transactions are transactions between residents and non-residents, the purpose of which is not the transfer of capital, while capital transactions are transactions between residents and non-residents with the purpose of transferring capital. Payment, collection, and transfer between residents and non-residents are executed freely under capital transactions, unless otherwise stipulated by the Foreign Exchange Operations Act.

Direct investments are residents’ investments abroad and non-residents’ investments in Serbia into a legal entity with the purpose of becoming involved in that legal entity’s management activities. Payments and capital transfers under direct investments of residents are executed freely, in accordance with the Foreign Trade Act, while payments and capital transfers under direct investments of non-residents are executed freely, in accordance with the Foreign Investments Act.

Payments regarding investments in immovable properties, that is, payments made for the purpose of acquiring ownership of immovable properties of non-residents in Serbia are executed freely, in accordance with the law governing the foundations of legal ownership relations.

Hopefully, now you have a better understanding of this particular law and its basic stipulations, so you can know which rights you have and which actions you can take as a resident or non-resident in the Republic of Serbia regarding foreign exchange operations.