Debt collection in Serbia for foreign companies

Start with the documents and the deadline

Collect the contract or order, the invoices, proof of delivery and any correspondence in which the debtor discusses the debt. These documents decide which route is available.

Under the Law of Obligations, claims between companies from commercial contracts for goods and services generally become time-barred after three years. The general limitation period is ten years. The period usually runs from the due date of each invoice.

The court does not apply limitation on its own; the debtor must raise it. Limitation is interrupted by filing a lawsuit or a motion for enforcement, or by the debtor acknowledging the debt. A reminder or demand letter alone does not interrupt it.

The demand letter

The first step is usually a formal demand letter from a Serbian attorney. Many debtors pay at this stage or propose a payment plan. A written payment plan signed by the debtor is also an acknowledgment of the debt.

• The exact amount and the invoices it covers
• The legal basis of the claim
• Statutory default interest from the due date
• A clear deadline for payment
• The bank account for payment
• The next step if payment is not made

Enforcement on an invoice or other authentic document

Serbian law allows a creditor to file a motion for enforcement directly on an authentic document, without first suing the debtor. An invoice, an extract from business books and a bill of exchange are typical examples.

The court issues a writ of execution, which is served on the debtor. The debtor can file an objection within 8 days of service. If the objection is well founded, the case continues as a lawsuit. If there is no objection, the writ becomes final and a public enforcement officer carries out the enforcement.

Enforcement can target funds in the debtor's bank accounts, movable assets, real estate, shares and claims the debtor has against third parties.

Lawsuits, foreign judgments and arbitration

If there is no suitable authentic document, or the debt is disputed, the creditor files a lawsuit before the competent Serbian court. A final judgment is then enforced in the same way.

A foreign judgment must first be recognized by a Serbian court. Foreign arbitral awards are recognized under the New York Convention, to which Serbia is a party.

When the debtor cannot pay

Before you spend money on enforcement, check the debtor's status in the Business Registers Agency and whether its accounts are blocked. A debtor with blocked accounts may still have real estate, vehicles or claims against others.

If bankruptcy proceedings are opened, enforcement stops and the creditor files the claim in the bankruptcy within the deadline set by the court. A claim filed late can be lost.

Common mistakes and when to involve a lawyer

We review your documents and deadlines, send the demand letter, file for enforcement and follow the case with the court and the enforcement officer, reporting to you in English. A foreign company can act through a power of attorney, without travelling to Serbia.

• Waiting too long, so that the claim becomes time-barred
• Relying on reminders, which do not interrupt limitation
• Missing proof of delivery or acceptance of the services
• Invoices that do not match the contract or the order
• Continuing to supply a debtor whose accounts are blocked
• Missing the deadline to file a claim in bankruptcy

Frequently asked questions