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Compliance for Non-Profit Organizations in Serbia and Montenegro: New Law Aims to Improve Transparency and Accountability

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BELGRADE, SERBIA - The Serbian government has introduced a new law aimed at improving transparency and accountability in state-owned enterprises, including non-profit organizations. The law, which comes into effect on [date], aims to increase the professionalism of management bodies and ensure that companies operate with greater transparency.

Key Provisions of the Law

  • Annual reports must be prepared and submitted to the National Assembly for information purposes.
  • State-owned enterprises must obtain consent from the government on all important corporate and business issues, including:
    • Changes to the founding act, legal form or status changes
    • Distribution of profits and coverage of losses
    • Capital investments
    • Disposal of high-value assets
    • Price list in connection with services/goods from the activities of the company

Code of Corporate Governance

The law introduces a new code of corporate governance for state-owned enterprises, which will be adopted by the government at the proposal of the Ministry of Economy. This code aims to ensure that companies operate with greater transparency and accountability, and that management bodies are composed of highly qualified and professional persons who continuously improve in the field of corporate governance.

Public Disclosure

State-owned enterprises must publish important acts and information related to their business operations on their website. The government will also have the power to regulate other elements of a company’s business operations that may be of importance to the public, and as such must be made publicly available.

Implementation and Impact

The Business Registers Agency will play a key role in implementing the new law, as it will be responsible for forming a publicly available unique record of data for state-owned enterprises. This record will contain information on the companies’ ownership structure, financial performance, and other relevant details.

Overall, the new law is expected to have a positive impact on compliance for non-profit organizations in Serbia and Montenegro, and will help to ensure that these organizations operate with greater transparency and accountability.