Changing a Sole Proprietorship to a LLC in Montenegro
Changing a Sole Proprietorship to a LLC in MontenegroUpdated on Tuesday 19th December 2017
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Montenegro has a favorable business environment which offers foreign and local entrepreneurs the possibility to set up both small and large companies. From sole proprietorships to limited liability companies (LLCs), business owners have to choose the company form first. Our lawyers in Montenegro can assist you with the procedure of setting up both sole proprietorship and LLCs in Montenegro.
Characteristics of an LLC in Montenegro
The LLC in Montenegro is the most used type of business utilized by investors and owners who want to do business in the country.
A LLC in this jurisdiction can be opened by only one person who can be the shareholder and the company director.
There are not any restrictions related to the citizenship and residency of the shareholder or director. The minimum paid up capital for such a business entity in Montenegro is EUR 1.
How to register a LLC in Montenegro
Starting with 2011, new companies in Montenegro can register any activity in one place. A one-counter operating system enables companies to be automatically registered in the register of the Department of Statistics, that of taxpayers and customs payers, of payers of the VAT, as well as of the excise taxpayers. This is effectuated by registering in the Central Registry of Business Entities.
In order to register a LLC in Montenegro, the following documents have to be filed:
• The minimum capital requirement of EUR 1;
• The founding act;
• The Contract of decision of the foundation of the business;
• Other documents: our attorneys in Montenegro can offer more details on what these other documents consist of.
Characteristics of a sole proprietorship in Montenegro
A sole proprietorship in Montenegro is named entrepreneur. This legal entity is a natural individual who is registered with the Central Registry of the Commercial Court and who undertakes an independent profession, including art, domestic activities and old trades.
An entrepreneur in Montenegro has to be registered in compliance with the local legislation which regulates the business entities in the country. Our Montenegro lawyers can offer all the necessary information related to this legislation.
Registering a sole proprietorship (entrepreneur) in Montenegro
In order to register a sole proprietorship (entrepreneur) in Montenegro, the following documents are required:
• A copy of an ID card or passport;
• To acquit the administrative fee for the registration, which is EUR 10;
• To acquit an administrative fee of EUR 12 for the publication of advertisements in the Official Gazette of Montenegro;
• An application form.
How can I change a sole proprietorship into an LLC in Montenegro?
A direct change from a sole proprietorship into a LLC in Montenegro is not possible. What has to be done if you want to effectuate such a change is to close the sole proprietorship first and then open another legal entity under the form of a LLC.
This change might be more advantageous from different aspects, since a LLC provides a limited responsibility and there are certain tax advantages which a LLC can benefit from in this country.
If you wish to know more about sole proprietorships and LLCs in Montenegro, or for legal advice in opening such business entities here, please contact our Montenegro law firm.