eKapija: According to recently presented results, the biggest progress was marked in 4 fields in relation to last year’s recommendations - construction land and development, protection of users of financial services, transport, and tobacco. What has contributed the most to the progress in each of these fields?
– Talking about construction land, we see the biggest progress in conversion and construction permitting. Also, significant steps were made when it comes to building consumer awareness of protection of users of financial services and adoption of by-laws. In terms of transport, investing in modernization of infrastructure and maintenance of existing one were done, while in tobacco industry, we witnessed the adoption of a multi-year excise plan and good results in fighting illicit trade.eKapija: The latest White Book also revealed 4 issues which should be urgently resolved in Serbia, according to foreign investors – company law, corporate income tax, restitution, and quality standards in milk production. What are key expectations in these 4 fields for 2018?
– Let me start with the Company Law. Our key recommendation is that limited liability partnerships (LLPs) should be expressly permitted. Also, we need to eliminate inconsistencies and provide clear procedures and competencies. It is necessary to precisely regulate increasing share capital through debt-to-equity swap and to align the Company Law with the Law on Contracts and Torts regarding limitations to the authority of a company’s representatives. As for corporate income tax law, we need to adopt definition of royalties for withholding tax purposes in line with international best practices, introduce monthly or quarterly tax filings and clarify the method of calculation and recognition of tax depreciation cost for the first group of fixed assets.
When we talk about restitution, FIC has two key proposals: the state should lead transparent restitution procedures and ensure that the acquired rights of foreign investors are protected, while enabling foreign nationals to exercise the right to restitution, equating them with Serbian nationals.
Our key expectations on quality standards in milk production are to have operational, fully independent, properly staffed, and technically equipped National Reference Laboratory
, lower and more affordable current price of raw milk testing and farm registration procedure should be simplified and made efficient, as registration is needed for exports to the EU.eKapija: Although real-estate was marked with positive grade, due to introduction of unified procedure and e-platform, restitution and conversion issue are still “hot” obstacles. Can Serbia cope with the restitution burden and what is the right recipe on that path?
– We believe so. For restitution, transparency and protection of rights are key words. It is also important to ensure that restitution does not automatically suspend conversion, except in case of public or state-owned company and to remove inconsistencies in the calculation of the conversion fee which hamper future investments.