Incentives for direct investments in the Republic of Serbia
Newsletter 63
In 2014 the Republic of Serbia adopted a new incentive program for green-field and brown-field projects in Serbia based on the Regulation on the terms and conditions for attracting direct investments (“Off. Gazette of the RS”, no. 55/2014), which entered into force on 24.05.2014 (hereinafter “the Regulation”).
The amount of funding that can be awarded is determined in relation to:
- eligible investment costs (investments in tangible and intangible assets as defined by the Regulation),
- or eligible costs of gross wages for new job positions within a period of two years upon the implementation of the investment project.
This kind of ascertainment of the funding amount differs from the previous regulation on attracting direct investments, which was based on a point scoring system.
Pursuant to the foregoing the Regulation stipulates a limit on the funding amount to be awarded, as follows:
- for eligible investment costs of up to 50 million EUR, the limit of awarded funds may not exceed 50% thereof; however exceptionally it may be increased by an additional 20% and 10% for small-sized companies and medium-sized companies respectively;
- for a part of eligible investment costs ranging btw 50 and 100 million EUR, the limit of funds may not exceed 25% of such costs;
- for a part of eligible investment costs exceeding 100 million EUR, the limit of funds may not exceed 17% of such costs. (Article 5 of the Regulation)
The beneficiary of funds must ensure a participation of no less than 25% of eligible costs from its own resources. (Article 6 of the Regulation)
