Attorney Dragana Djordjevic » Blog » Commercial law (25)

Financing of the company by the founders through loan

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Contracting and implementation of the loan to the company from the founders is almost entirely governed by the provisions of the Law on Contracts and Torts.

The Companies Act in the part Additional Payments and Loan to the Company (Articles from 178 to 181) prescribes manner of esblishing the additional payment obligation, consequences of failure to make addititonal payment and return of the additonal payments, but does not provide specific rules relating to the loan. Provisions of the Companies Act which regulate payment limitations to the company’s founders, approval of a transaction in which there is personal interest and company’s share capital increase contain norms that are important for the contracting and implementation of loan.

The Law on Cotract and Torts doesn’t impose restrictions when it comes to the conclusion of the loan contract and the lender can be both as a business entity and natural person. According to the provisions of Article 557 of the Law on Contract and Torts by a loan contract the lender shall assume the obligation to transfer ownership to the borrower of a specific amount of money or other interchangeable objects, while the borrower shall assume the obligation to restitute after a certain time to him the same amount of money, or same quantity of objects of the same kind and quality. Continue reading Financing of the company by the founders through loan →

Forms of work engagement in Serbia

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The Labor Law provides ways of the working engagement of persons in the Republic of Serbia, which are the legal and statutory methods of the working engagement. Overall in the Republic of Serbia, persons may be engaged in work as much the employer will establish employment relationship with them, or they will be engaged outside employment relationship, on one of the ways prescribed by the provisions of the Labor Law.

Employment Relationship

Employment relationship for a indefinite period of time is the basic form of the employment relationship, but not the only form of the employment relationship. Besides it there are other forms of the employment relationsip, as follows:

  • Employment relationship with a probation work
  • Employment relationship for a definite period of time
  • Employment relationship for performing higher-risk jobs
  • Part-Time employment relationship
  • Employment relationship for performing jobs outside the employer’s premises
  • Employing household help and
  • Employment relationship with trainee.

Continue reading Forms of work engagement in Serbia →

Reduction of share capital of the limited liability company

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A limited liability company’s share capital may be reduced by the resolution of the company’s general meeting, but not below the minimum share capital, which amounts to at least RSD 100, unless a special law provides a higher amount of the share capital for companies dealing in certain business activities.

Decision to reduce the share capital of a limited liability company below the minimum share capital may be passed only under a condition that an increase in share capital is simultaneously carried out, so that, as a result of such reduction and increase the company’s share capital becomes at least equal to the minimum amount of share capital, which amounts to at least RSD 100, unless a special law provides a higher amount of the share capital for companies dealing in certain business activities.

If the limited liability company fails to simultaneously pass a decision on increase of share capital and fails to carry out such increase, the decision on reduction of share capital is null and void. Continue reading Reduction of share capital of the limited liability company →