MONTENEGRO PROPERTY

Full Name: Republic of Montenegro
Capital City: Podgorica
Area: 13,810 sq km / 5,332 sq miles
Population: 620,000
Languages: Montenegrin / Serbian
Religion: Serbian Orthodox, Montenegrin Orthodox, Muslim, Roman Catholic
Currency: euro (€)

Reasons to Invest in Montenegro Property

Montenegro is the first Independent State in 21 st Century Montenegrins voted to sever their remaining ties with Serbia. The May 21 referendum, in which 55.5 per cent of Montenegro's voters chose independence, completes the process of disintegration of federal Yugoslavia that began in 1991. It is important to recognize, however, that national sovereignty is not a good thing in and of itself. Depending on the choices they make, countries can either succeed or fail to improve their lot. As such, the consequences of the victory by the pro-independence camp will go far beyond settling Montenegro's international status. As the government charts Montenegro's future economic policies, it should remember how an open economy and business-friendly environment can benefit the people and provide an example for other regional countries.
By analyzing these factors, we come to the conclusion that Montenegro, as an independent state, has more opportunities to attract foreign capital. However, the main incentive for foreign investors to invest in Montenegro is developing economic freedoms, stable currency (Euro), macroeconomic predictability, protected ownership rights etc.

Easy Start Up and No Restrictions for Foreign Investors
You can set up limited liability company in Montenegro within four working days.
Legal framework of Montenegro for encouraging foreign investments – For the purposes of performing business activities in the Republic of Montenegro foreign investors can invest into other forms of organization for performing activities or services.
Fields in which a foreign investor can invest his funds – Joint stock company (shareholder’s company, limited liability company, limited partnership and unlimited solidary liability company); Private company and private business; Contractual company; Bank and other financial organization; Cooperative; Organization for insurance and other forms of cooperation and joint business operation stipulated by the law.
Treatment of a foreign investor compared to the treatment of a domestic investor - In the Republic of Montenegro a foreign investor can establish a company and invest in it in the manner and under the conditions which are the same as for domestic persons. This means that a foreign investor is given a national treatment, i.e. the same regulations applied for domestic investors apply to foreign investors – not any „other“ regulations which might deprive him of any rights or limit such rights.

Strong Currency
Montenegro adopted Euro in the same time when it was introduced in EU countries. The local currency was abandoned in November 1999. Initially, we introduced the German mark and then the Euro. If you make an investment you know exactly how much is your profit, since inflation in Montenegro is calculated on a Euro base.
Therefore, your business calculations are going to be straight, without risk of inflation of the local currency. Not to mentioned that transactions costs caused by money exchange are avoided.

Favorable Tax Climate
The corporate tax rate is 9 per cent. Personal income tax rates, between 15.5 per cent and 23.5 per cent, are among the lowest in Europe. Montenegro's flat value-added tax of 17 per cent (and 7 per cent for tourism) is also low compared to the rest of Europe.
There are a few tax incentives in tax system of Montenegro such as: in case of taxpayer who hires new employees, tax base shall be reduced by the amount of earnings paid to the new employees; a newly established legal entity that conducts a production activity in an economically underdeveloped municipality is exempt from paying tax for the first three years and in case of reinvesting from profit.

Stable Macro-economy and Good Market Opportunities
In recent years, Montenegro has made much progress. The government replaced the Yugoslav “dinar” with the euro, which significantly reduced exchange rate risk for companies doing business in Montenegro. Inflation has declined sharply, reaching just 1.8 per cent in 2005. The republic credit rating has been evaluated at BB+ and 87% of government property has been privatized.
The movement of capital is free and the corporate tax rate is 9 per cent. Personal income tax rates, between 15.5 per cent and 23.5 per cent, are among the lowest in Europe. Montenegro's flat value-added tax of 17 per cent is also low compared to the rest of Europe.
Net foreign direct investment in 2005 was €380m ($490m) or four times more than in 2004. The World Bank's "Doing Business in 2006" report found that "Serbia and Montenegro led in making the kinds of reforms that can spur growth in firms and jobs".

There are a lot of market opportunities through different economy sectors:
Capital market
Energy sector
Tourism
Agriculture
Automotive industry (industry of auto parts)
Telecommunications Sector
Maritime industry
Banking sector