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The Government of the Republic of Serbia

In the service of citizens

Bill on deadlines for settling obligations to be adopted soon

Belgrade, 18 January 2012

Minister of Economy and Regional Development Nebojsa Ciric today announced that a bill on deadlines for the settlement of financial obligations, envisaging 60 days as the limit for settling all payables, will be adopted by the parliament in end-January or early February.

Speaking at a round table discussion where a working version of this document was debated, Ciric affirmed that the bill will be sent to the government for discussion next week.

The main goals of this bill are improvement of liquidity, transparency in business, equal status of the private and public sectors and harmonisation with EU regulations and the best international practice, he stressed.

The Minister noted that payment deadlines are limited to 30 days in the EU, adding that due to the specific situation the Serbian economy is in, this deadline will here be 60 days.

In Croatia and Slovenia the deadline is also 60 days, although in extraordinary circumstances it can be prolonged up to 120 days at the most, Ciric observed.

He stated that the average deadline for collecting accounts payable in Serbia in 2010 was 183 days, while in September 2011 it was 129 days.

The average deadline in the construction industry is 227 days, in the food industry 164 days and in the textile industry 163 days.

The Minister underlined that the bill also envisages penalties, specifying that the lowest fine for violation of the deadline is RSD 100,000, while the person responsible for this matter in an enterprise or in the public sector can be fined between RSD 50,000 and RSD 150,000.

An exception to the 60-day rule are small enterprises, Ciric said, explaining that the law will be implemented two months after its enforcement so that business entities and the public sector can have the time to adjust to new business terms and new deadlines.

State Secretary of Finance Dusan Nikezic said that the bill will help to improve responsibility when adopting budgets and business plans in the public sector.

Nikezic stressed that the bill is important for the Ministry of Finance because there is no reason why the public sector should be a generator of non-liquidity in Serbia, adding that it will facilitate realistic planning of budgets and their implementation in line with these presuppositions.

The new financial solutions will enable the economy to plan its business operations more efficiently. We expect them to be particularly useful to the SME sector, because these companies will now be able to engage in investments more easily, knowing that their receivables will be settled, he observed.

The bill introduces urgency into the court procedure, which was the “missing link” in the current business operations, he said, adding that the economy will now be able to rely more on the judiciary.

Nikezic affirmed that talks have begun between representatives of the government, the National Bank of Serbia and commercial banks regarding ways to make the approach to capital cheaper and effectively solve current problems in practice.

The Development Bank will start operating this year and we can expect a lot from it, he said, adding that the Bank’s founding portfolio of €400 will be sufficient for the time being, but it will not be the only source of financing.

The state budget for 2012 also reflects the necessity to assist the economy, bearing in mind that almost the entire budget deficit has been envisaged for infrastructure investments, Nikezic underscored.

If we add the 5.5 % of GDP that has been allocated for agriculture, we can see that the state intends to help create a better business ambience in Serbia, the State Secretary concluded.