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01. 07. 2014.

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. 
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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) 

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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)

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