- I. BASIC PROVISIONS
- II. GUARANTEED RIGHTS OF FOREIGN INVESTORS
- Ill. INCITEMENTS TO FOREIGN INVESTORS
- IV. SETTLEMENT OF DISPUTES
- V. SPECIAL RULES
- VI. FOREIGN INVESTMENT REGISTRATION AND RECORDING
- VII. TRANSITIONAL AND CONCLUDING PROVISIONS
FOREIGN INVESTMENT LAW
I. BASIC PROVISIONS
Scope of Application
Article 1
This Law regulates foreign investment in enterprises and other forms of conducting business for the purpose of making profit (hereinafter: the enterprises) in the Federal Republic of Yugoslavia.
Foreign investments in insurance companies, banks, other financial organizations and free zones may be made in conformity with the federal law dealing with their formation and legal status.
Foreign Investor
Article 2
For the purposes of this Law, a foreign investor shall be one of the following:
1. Any legal entity, the registered office of which is abroad;
2. Any foreign individual;
3. Any Yugoslav citizen who has been residing abroad for more than a year.
Foreign Investment
Article 3
For the purposes of this Law, foreign investment in the FR of Yugoslavia shall be understood to mean the following:
1. Investment in a Yugoslav enterprise on the basis of which a foreign investor acquires an interest in or shares in the authorized capital of that enterprise;
2. Acquisition of any other proprietary rights by a foreign investor, with the means of which it pursues its business interests in the FR of Yugoslavia.
Basic Forms of Foreign Investment
Article 4
Any foreign investor may do the following, either alone or together with other foreign or domestic investors:
1. Form an enterprise;
2. Buy shares of or interests in an existing enterprise;
The basic forms of foreign investment shall be regulated by formation contracts and/or investment contracts made in writing and/or formation decision rendered in writing.
Special Forms of Foreign Investment
Article 5
Any foreign investor may be granted a permit (concession) for the use of a natural resource and a good in general use or for conducting a business of general concern, in conformity with law.
Any foreign investor may be allowed to build, operate and transfer (B.O.T.) a building, installation or plant, as well as infrastructure and communication facilities.
Foreign Investor's Investment
Article 6
A foreign investor's investment may consist of convertible foreign currency, things, intellectual property rights, securities and other property rights.
A foreign investor's investment may consist of dinars, which under the foreign exchange management regulations, may be transferred abroad, including also the reinvestment of profit.
A foreign investor may convert its established receivables into an interest in or shares of its debtor company.
Non-monetary investments shall be expressed in money.
II. GUARANTEED RIGHTS OF FOREIGN INVESTORS
Freedom of Foreign Investment
Article 7
Any foreign investor may form or invest in an enterprise for the conduct of any kind of business for the purpose of making profit, unless otherwise provided by this Law.
National Treatment
Article 8
With regard to its investment, any foreign investor shall enjoy the same status, rights and duties as domestic individuals and legal entities, unless otherwise provided by this Law.
Any enterprise in which a foreign investment has been made shall enjoy the same legal status and operate under the same conditions and in the same way as Yugoslav enterprises in which no foreign investment has been made.
Legal Security
Article 9
Any foreign investor shall enjoy full legal security and legal protection with regard to the rights acquired on the basis of investment.
The rights acquired by a foreign investor at the moment of registration of its investment may not be disparaged by subsequent changes in laws and regulations.
A foreign investor's investment and the assets of an enterprise in which a foreign investment has been made may not be subjected to expropriation or other measures imposed by the state that produce the same effect, except when public interest is determined by law or on the basis of law, in which case a compensation shall be payable.
The compensation referred to in paragraph 3 of this Article shall correspond to the market value of the subject of expropriation or other measure on the date of enactment of such measure. Any change in the value of the subject of expropriation or other measure that may arise because such measure became public knowledge, shall not affect the assessment of its market value, which is to be made for the purpose of paying such compensation.
The compensation referred to in Paragraph 3 of this Article shall be paid without any delay in convertible currency and the foreign investor concerned may transfer it abroad without any restrictions. In the event of a delay in the payment of this compensation, the foreign investor concerned shall be entitled to statutory default interest.
Conversion and Unrestricted Payment
Article 10
With regard to any payment associated with a foreign investment, any foreign investor may convert domestic currency into a convertible foreign currency without any restrictions.
Any enterprise in which a foreign investment has been made may make payments in the scope of international business relations without any restrictions.
Any enterprise in which a foreign investment has been made may keep foreign currency in a foreign exchange account with an authorized bank and dispose of such funds without any restrictions.
Right to Keep Books
Article 11
Besides the duty to keep books and make financial statements in conformity with domestic regulations, an enterprise in which a foreign investment has been made shall have the right to keep books and make financial statements in conformity with internationally accepted accounting and auditing standards.
Right to Transfer Profit and Assets
Article 12