A company (privredno društvo) is the most common form of business organization for larger business undertakings and is established through registration with the SBRA. Different legal forms exist (limited liability company – LLC/DOO, joint-stock company – JSC/AD, general partnership – GP/OD, limited partnership – LP/KD), but in practice, the LLC (DOO) is the most frequently chosen.
Main characteristics of a limited liability company (DOO):
Company registration with the SBRA is usually completed within three to five business days, provided that complete documentation is submitted. It is important to note that, as of 17 May 2023, company incorporation applications must be submitted exclusively in electronic form.
A sole proprietor is a natural person registered to perform a specific business activity. Registration is also carried out with the SBRA, and the procedure is slightly simpler than company incorporation.
Main characteristics of a sole proprietor:
This form is suitable for artisans, freelancers, consultants, or small family businesses.
On average, three to five business days from the submission of complete documentation.
Usually two to three business days.
Yes, both foreign natural and legal persons may establish an LLC or sole proprietorship, subject to submission of notarized and translated documentation and obtaining residence and work permits in the Republic of Serbia.
Yes. A sole proprietor may establish employment relationships and register employees for mandatory social security.
Yes, the law prescribes a procedure for transformation into an LLC.
The proprietor remains personally liable with all assets, even after the business has ceased.
Members bear the risk only up to the value of their contributions. They are not personally liable with their own property, except in cases of piercing the corporate veil.
Yes, if real estate or another right is contributed, a valuation by a certified court expert is required, except in special cases prescribed by law.
Costs depend on SBRA fees, as well as notarial authentication and accounting fees. For up-to-date amounts, it is recommended to consult the SBRA and a public notary.
Yes, through eRegistration using a qualified electronic signature.
No, the registered office may be the proprietor’s residence, except where special conditions are prescribed (e.g., hospitality sector).
Yes, an LLC may be established by a single member, who can also serve as its director.
It is the statutory minimum required to establish an LLC. In practice, however, the company must have sufficient assets to operate and cover expenses.
No, one individual may register only a single sole proprietorship.
Closing a sole proprietorship is simpler and faster, requiring only submission of a request to the SBRA. The liquidation of an LLC is more complex, lasting several months and involving statutory publications, a liquidation process, and settlement of creditors. An LLC may also cease through bankruptcy in legally prescribed circumstances.
All due taxes and liabilities must be settled prior to cessation. In an LLC, the company is liable with its assets, while in a sole proprietorship, the owner remains personally liable even after deregistration.
If you are considering starting a business and are uncertain between forming a company or registering as a sole proprietor, it is important to fully assess the differences in terms of liability, capital, and tax treatment. The Law Office Marović will help you make the right decision and carry out the entire process swiftly and securely.
Note: The content of this text is for informational purposes only and does not constitute legal advice. While we strive to ensure that all information is accurate and up to date, each situation has its own specific circumstances and requires individual legal assessment. For precise and reliable advice regarding your particular case, it is recommended that you consult a lawyer.
Last updated: October 17, 2025.
