Serbia Introduces New Rules Regarding State Aid for Maintaining Liquidity and Working Capital

August 13, 2021

Serbia Introduces New Rules Regarding State Aid for Maintaining Liquidity and Working Capital

August 13, 2021

Miloš Velimirović

Miloš Velimirović


Andja Savić

Andja Savić

Senior Associate

The Serbian parliament has enacted the Law on Establishment of Financial Support to Legal Entities for Maintaining Liquidity and Working Capital in difficult economic conditions due to Covid-19 pandemic caused by SARS-COV-2 virus (the „Law“). At least RSD 12 billion (cca. EUR 103 million) will be provided from the European Investment Bank’s credit line for the implementation of the Law.​


Who qualifies?


Each applicant must meet the following conditions:

  • to be registered as an entrepreneur, a cooperative, a micro, small and medium-sized legal entity, majority privately or cooperatively owned,
  • to perform production, trade, or agricultural activities or to provide services,
  • not undergoing insolvency, liquidation, measures of reorganisation or financial restructuring,
  • submitted a loan application to the Development Fund of the Republic of Serbia (the „Fund“) by 10 December 2020, and not obtaining a decision upon the application by 29 July 2021.


How can the funds be used?


The funds can be used for the procurement of working capital and maintaining the current liquidity of the aforementioned categories, to be able to settle its obligations in the ordinary course of business.

Funds cannot be used for (i) organizing games of chance, lotteries, and similar activities; (ii) trade in oil and oil derivatives), or (iii) production and trade of products or for activities that are prohibited.


Loan Conditions


The funds may be granted under the following conditions (different conditions apply for legal entities whose predominant business activity is tourism, hospitality, or passenger traffic):

  • the repayment period is up to 48 months, including a grace period of up to 18 months;
  • 1% of the interest rate per annum;
  • the minimum loan amount (starting from RSD 200,000 to RSD 1 million) and the maximum loan amount (from RSD 10 million to RSD 1000 million) depend on the category of an applicant; the maximum amount of the approved loan can be up to 50% of the realized business revenues according to the financial report in 2019;
  • security instruments (a mortgage, a pledge on movables, a promissory note of the applicant’s shareholder, and/or promissory note of a guarantor/assignee) depend on the amount of the loan; shareholders who are foreign citizens or companies registered abroad do not submit personal promissory notes;
  • dividend distribution is not allowed until the end of 2021 (payment in shares is allowed).

The Fund will decide upon the applications until 31 December 2021


Prolongation of Repayment Period


The Fund announced that the repayment period for debtors to whom the loan was approved in 2020, except those whose predominant business activity is tourism, hospitality, or passenger traffic, will be extended by 12 months (6 months for both grace period and the repayment period) without concluding a separate annex to the loan agreement.

All debtors who do not want to use this opportunity are obliged to submit a statement via e-mail: no later than 28 August 2021, otherwise the repayment period and grace period will be automatically extended.



This text is for informational purposes only and should not be considered legal advice. Should you require any additional information, feel free to contact us.


Miloš Velimirović, Partner

Andja Savić, Senior Associate


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