– The Right to Acquire Share –

Financial Instrument for Remuneration in Limited Liability Companies in Serbia

As of 1 April 2020 Limited Liability Companies founded in Serbia have access to a new method of remunerating their employees, managers or consultants entitled “Financial Instrument – Right to Acquire Shares”.

The “Financial Instrument – Right to Acquire Shares” (hereinafter: “The financial instrument”) entitles a specified person to acquire a share on a specified date (“maturity date”) at a specified price.  It is non-transferable and cannot be pledged or inherited, and must be registered in the Central Securities Depository and Clearing House (hereinafter: “The Central Depository”.)

Prerequisite to this Financial instrument is:

– prior existence of shares reserved for issuance (“reserved shares”). Reserved shares are unissued shares that the company appropriates with the express purpose of deploying the financial instrument. A company may have multiple reserved shares, but the total percentage of all reserved shares in the total share capital cannot exceed 40%. Decision on company’s reserved own shares requires a majority vote of two thirds of all company members.

– the General Assembly of the Limited Liability Company`s (d.o.o. in Serbian.) decision to issue the financial instrument.

Once the decision is made, the company submits the decision to the Central Depository where financial instrument and its legal holders are registered within 5 days.

For all additional inquiries feel free to contact us.

Marko Janicijevic, Attorney at law