Shareholders in Montenegro

Updated on Tuesday 03rd September 2024

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The shareholder of a Montenegrin company is any person or legal entity that owns at least one share of the company`s stock. According to the Law on Business Organization in Montenegro, the founders of any type of company who execute the foundation agreement become the company`s shareholders. The shareholders in Montenegro are the owners of a company, benefitting from its success in the form of increased stock valuation. The rights and obligations of a shareholder are referred to in the Montenegrin legislation.

Further details on the matter can be provided to you by our lawyers in Montenegro.

Who can act as a shareholder in a Montenegrin company?

Both natural persons and companies are allowed to act as shareholders in Montenegro companies. In terms of nationality, there are no requirements for them to be citizens of this country. However, here are a few important aspects to consider if you are a foreigner and want to open a company in Montenegro:

you are not required to comply with the immigration regulations in Montenegro if you only plan to set up the business and not move here (in this case, you can also opt for a nominee shareholder);
you must apply for a residence permit in Montenegro if you plan to set up your business and relocate to the country.

Speaking of immigration, our lawyers can also assist if you want to apply for citizenship in Montenegro if you have lived here at least 10 years, no matter if you are a shareholder in a company or not.

These requirements apply for foreign citizens. In the case of companies acting as shareholders in Montenegro, they have two options:

to establish holding companies;
to create subsidiaries or branches in Montenegro.

Our law firm in Montenegro can help you create more complex structures, such as holding companies.

The rights of shareholders in Montenegro

The shareholders of Montenegrin companies benefit from special rights among which:

the right to elect the managing and executive bodies of the company and select the company`s auditor;
the right to request that the company`s founders compensate the company for any liabilities incurred prior to the day of its registration due to the founder`s failure to fulfill their obligations;
the right to appoint the director of the company;
the right to issue new shares;
the right to make decisions in different situations.

According to the Law on Business Organization, all shareholders in Montenegro are treated equally in the same circumstances. They have such rights in a company as are attached to the shares they own. The shareholders in Montenegro have no other liabilities to the company than the obligation to pay the initial price of all the shares subscribed for. Complete information about the rights of shareholders can be given to you by our attorneys in Montenegro.

Shareholders agreements in Montenegro

There are no special laws which regulate shareholders` agreements (SA) in Montenegro. In this case, the general rules regulating contracts are applied. The mutual rights and obligations of shareholders in Montenegro are regulated by company`s by-laws: Memorandum of Association and Articles of Association. There are no formalities to be complied with by the shareholders` agreements in Montenegro. These agreements can contain information about the rights and obligations of the company`s shareholders. Nevertheless, the Montenegrin law stipulates that all legal aspects related to shareholders are regulated by the Memorandum of Association (MoA) and Articles of Association (AoA).

Nominee shareholders in Montenegro

The term ‘nominee shareholder’ designates a service provider who can act as a shareholder when setting up a company in Montenegro.

Nominee shareholders in Montenegro act as trustees and can:

be entered with the Companies Register upon the creation of the business in order to protect the beneficial owner of the enterprise;
hold a specific number of shares on behalf of the beneficial owner of the company;
be used to create shelf companies that are later put on sale.

In most cases, foreign entrepreneurs decide to use nominee shareholders in Montenegro in order to register their companies faster.

You can obtain more information about this service from our lawyers in Montenegro.

The appointment of nominee shareholders in Montenegro

Nominee shareholders are not appointed the usual way. They are usually selected among service providers (in many cases, trustees are used for such a function). The parties enter a contract in which the responsibilities and benefits of each of them is stipulated. Here are some of details of such a contract:

the duration of the contract;
the duties of the Montenegrin nominee shareholder;
the payment received by the service provider;
the restrictions imposed by the beneficial owner to the nominee shareholder.

In most cases, the nominee will not have access to the company’s accounts or handle its assets.

Business statistics in Montenegro

Speaking of business registration in Montenegro, the latest statistics indicate that:

at the level of 2023, the number of companies reached 54,094;
this represented an increase of 18.4% compared to the previous year;
the largest number of companies operated in Podgorica (18 593), while the smallest number was registered in Gusinje with only 40 businesses.

If you need assistance for the procedures of company incorporation or consultancy in drafting a shareholders` agreement, please contact our law firm in Montenegro.