Registration of Beneficial Owners in the Republic of Serbia – Improvement of the Regulatory Framework

Registration of Beneficial Owners in the Republic of Serbia – Improvement of the Regulatory Framework

December 01, 2021

The Law on Central Record of Beneficial Owners was recently re-amended, for the purpose of specifying certain of its provisions. The law amending this regulation entered into force on November 16, 2021, whereby its application will start upon the expiry of 18 months from the day of its entry into force (the “Law”).

As a reminder, the regulation concerned governs the establishment, content, bases of registering, and manner of keeping the Central Record of Beneficial Owners of legal entities and other subjects registered in the Republic of Serbia, as well as other issues of relevance for registration of beneficial owners.

Defining of Authorised and Responsible Person

The Law defines authorised person as a founder in procedure of incorporation of the registered entity electronically, or a person authorised for representation of the registered entity in all other cases, whereas responsible person in a registered entity is the authorised person, as specified by the Law.

As a clarification, registered entity is a legal entity and other subject registered in the Republic of Serbia in accordance with law, i.e.:

  • company, except for a public joint-stock company;
  • cooperative;
  • branch of a foreign company;
  • business association and association, except for political parties, syndicates, sport organisations and associations, churches and religious communities;
  • foundations and trusts;
  • institutions; and
  • representative office of a foreign company, association, foundation, and trust.

Specifying of Data on Beneficial Owner that the Authorised Person is Liable to Register, as well as Deadline for Registration of the Data

The Law stipulates that the authorised person shall register precisely specified data in the respective record. As a reminder, these data include:

  • for a domestic natural person – personal name, personal ID number, and state of residence;
  • for a foreign person – personal name, passport number and country of issuance and/or personal number of foreign person and/or ID card number of foreign person and country of issuance, as well as day, month, year and place of birth, state of residence and citizenship;
  • for refugees or evicted persons – personal name, ID number, date, month, year and place of birth and country of residence; and
  • basis for acquiring the capacity of beneficial owner of the registered entity, in accordance with the Law.

In addition, the Law prescribes that the person authorised for representation of a registered entity shall be obliged to enter the data in the Central Record no later than 15 days from the onset of basis for recording from Article 6 of the Law, i.e. in case of incorporation of the registered entity, and in case of change in ownership structure and members of bodies of the registered entity, as well as other changes based on which the fulfilment of conditions for acquiring the capacity of registered entity’s beneficial owner of may be assessed.

Obligation to Use the Users’ Application for Receipt of the Electronic Application During the Registration of Data on Beneficial Owner

The Law also prescribes the obligation for the authorised person to register the prescribed data indirectly through users’ application for receipt of electronic application for the incorporation of registered entities.

Sanctions in Case of a Breach of Obligation to Register Data on Beneficial Owner

Furthermore, the Law specifies the description of offence effected by the registered entity that fails to register accurate data in the Central Record, by stipulating that such data are prescribed by Article 5 paragraph 2. of the Law, and previously mentioned as data whose registration is the obligation of authorised person of the business entity.

In addition, the amendments envisage that a responsible person in the registered entity – legal entity, i.e. a person authorised for its representation will also be fined for the same offence with RSD 50,000 to 150,000.

Also, the Law introduces a new offence in case of electronic incorporation of a registered entity, stipulating that, in case of failure to register accurate data on beneficial owner under Article 5 paragraph 2. of the Law during such establishment, the registered entity – legal entity will be fined with RSD 500,000 to 2,000,000, while the responsible person will be fined with RSD 50,000 to 150,000.

This article is to be considered as exclusively informative, with no intention to provide legal advice. If you should need additional information, please contact us directly.