Montenegro Market Entry

Montenegro Market Entry

Subchapters:

  • Market entry
  • Forms and conditions of operation on the market
  • Marketing and Communications
  • Issues of intellectual property protection
  • Public procurement market
  • Payment terms, payment ethics and resolution of commercial disputes
  • Visas, fees, specific conditions of travel to the territory
  • Employment of citizens from the Czech Republic
  • Fairs and events

Market entry

The biggest problems of doing business in Montenegro are insufficient infrastructure, bureaucracy, weak work discipline of the able-bodied population, to a certain extent corruption, organized crime and ambiguities in land books and real estate cadastre. The legislative environment is governed by over twenty commercial laws. Check smber for agriculture and fishing facts of Montenegro.

Forms and conditions of operation on the market

A popular form of applying imported goods (and services) on the market is the representation of foreign companies by local representatives, due to the important role of personal ties and the relationship of representatives with potential customers.

Marketing and communication

The PR and promotion market in Montenegro has seen great progress in recent years. When a new company enters the market, publishing materials in the local language is always appreciated. Modern advertising channels such as FB, TW or Instagram are widely used in Montenegro.

Issues of intellectual property protection

In 2007, Montenegro established the Agency for the Protection of Intellectual Property, which is a state administration body.

Public procurement market

Montenegro has the issue of the public procurement market regulated by a separate law, and individual tenders are published by the Directorate for Public Procurement Policy (Directorate for Public Procurement Policy). State tenders in Montenegro run similarly to the Czech Republic.

Payment terms, payment ethics and resolution of commercial disputes

Dispute resolution is the responsibility of national courts. The court system consists of three levels: basic (15 courts in 24 municipalities), higher (2 courts) and supreme. The institute of bank guarantees normally operates. However, the execution system for debtors continues to function quite successfully thanks to the relatively solid efficiency of economic courts. The due date for invoices is 30 days by law.

Visas, fees, specific conditions for traveling to the territory

Citizens of the Czech Republic can travel to Montenegro without a visa for up to 90 days within 180 days. It is recommended to take out additional commercial insurance for trips to Montenegro.

Employment of citizens from the Czech Republic

The employment of foreign nationals is regulated by the Law on Foreigners. The development of the Montenegrin economy, despite unemployment (at the end of 2021 – 24.73%), cannot be done without foreign labor. These are primarily seasonal summer jobs. The level of basic (state) healthcare is lower than in the Czech Republic. ZÚ recommends that you take out additional commercial health insurance before traveling to Montenegro.

Fairs and events

Most of the main fairs and similar events take place in the seaside town of Budva. The most famous fairs/events include: Tourism Fair, NAUTIC SHOW, Energy Fair, etc.

Market entry

Lack of access to credit, high taxes, restrictive regulations on the labor market, insufficient infrastructure, bureaucracy, weak work discipline of the able-bodied population and, to a certain extent, corruption and organized crime are cited as the biggest problems of doing business in Montenegro. In order to attract foreign investment, the government of Montenegro has narrowed previous investment restrictions, allowed the transfer/repatriation of profits and dividends, and provided numerous investment guarantees. The Foreign Investment Act unifies the procedure for approving a foreign investment agreement, reduces the minimum share of foreign capital participation from 51 to 25%, expands the activities in which a foreigner can have a majority stake, unifies the position of a foreign investor with a domestic one in tax matters, legal protection and property protection . It guarantees the right of transfer to another person as well as the repatriation of profit, it provides the foreign investor with protection against property expropriation. The legislative environment is further regulated by over twenty commercial laws. The most important are the Business Organizations Act (simplified the business registration procedure), the Commercial Insolvency Act, the Accounting and Audit Act, the Competition Act, the Customs Act, the Labor Code, the Central Bank Act, the Act on Contributions, the Act on Strikes, the Act on Electronic signature and law and free zones.

Forms and conditions of operation on the market

A popular way of using imported goods (and services) on the market is the representation of foreign companies by local representatives. The significance of this form of application on the market is not negligible, as long-term personal, often family ties and relations between representatives and potential customers play an important role in local conditions. Foreign companies most often resort to providing representation to local representatives for a limited period of time, which is further extended if both parties are satisfied. Since 2001, Montenegro has had a simplified procedure for establishing companies. At least in theory, €1 (in words: one EURO) should be enough for an entrepreneur to establish a company, the time should not be longer than 4 working days. Further details can be obtained through the Montenegro Business Alliance

Most companies are established in the form of an s.r.o. (in the local language it is a d.o.o.

Marketing and communication

The PR and promotion market in Montenegro has seen great progress in recent years. When a new company enters the market, publishing materials in the local language is always appreciated. Modern advertising channels such as FB, TW or Instagram are widely used in Montenegro. Clients are still used to traditional advertising, e.g. in newspapers and on billboards. It is not possible to recommend a specific PR agency, as there are practically constant changes in this area.

Issues of intellectual property protection

In 2007, Černá Hora established the Agency for the Protection of Intellectual Property, which is a state administration body whose competence includes the area of ​​industrial property rights, the depository and registration of copyrighted works. More detailed information on the mentioned issue can be found on the agency’s website http://www.ziscg.me/.

Public procurement market

General operation of tenders, rules for registration, financing, documentation, important links to relevant authorities.

Montenegro has the issue of the public procurement market regulated by a separate law, and individual tenders are published by the Directorate for Public Procurement Policy ( Directorate for Public Procurement Policy of the Ministry of Finance of the Czech Republic). Tender participants can address their comments or complaints about the course of individual proceedings to the Commission for the Protection of Rights in the Matter of Public Procurement (Komisija za zaštiti prava u žeštěm prábni nabavki). State tenders in Montenegro run similarly to the Czech Republic.

We always recommend that you read the individual information regarding specific tenders thoroughly, it is not an exception that the tender application must be exclusively in the Montenegrin language, we also recommend that you personally participate in the opening of the tender envelopes or appoint a representative who will be present for the foreign company, etc.

Payment terms, payment ethics and resolution of commercial disputes

Disputes are settled by national courts, with the exception of those where the Montenegrin side allows international arbitration. The court system consists of three levels: basic (15 courts in 24 municipalities), higher (2 courts – Podgorica and Bijelo Polje) and supreme. A Court of Appeal and an Administrative Court with special jurisdiction over commercial matters are also established. The cautious approach of foreign investors is related to the effects of the Covid-19 pandemic, the global financial crisis, as well as the often problematic payment morale of Montenegrin economic entities, ongoing complex procedures associated with issuing various permits, continued widespread corruption (relations and ties of local political elites with the business sector) and ambiguities in land registers and the real estate cadastre. The institute of bank guarantees normally operates. However, the execution system for debtors continues to function quite successfully thanks to the relatively solid efficiency of economic courts. The due date for invoices is 30 days by law, but in practice it is often 7 days.

Visas, fees, specific conditions for traveling to the territory

Citizens of the Czech Republic can travel to Montenegro without a visa for a period of up to 90 days in one half-year. If a citizen of the Czech Republic is interested in staying in the country for a longer period of time, he must apply for a temporary residence permit – i.e. for more than 90 days. An application for a visa/temporary residence permit can be submitted to the Embassy of Montenegro in Vienna, which also administers the Czech and Slovak Republics. In some cases, a temporary residence permit can only be applied for in the territory of Montenegro (for the current rules and conditions, you need to contact the Embassy of Montenegro in Vienna or the Foreign Police of Montenegro). It is recommended to take out additional commercial insurance for trips to Montenegro. It is recommended to use a personal vehicle to travel within the territory of Montenegro (do not rely on city, intercity buses or train transport). Taxis are a very frequently used and affordable means of transportation in cities. Taxi must be ordered by phone/hotel reception. Hotels in Montenegro have a similar standard as in the Czech Republic, there is the possibility of quality accommodation at an affordable price. Payments can be made both in cash and by credit card, payment by credit card is more widespread even in smaller towns and shops. In most cases, it is not recommended to drink tap water in hotels. Vaccination to Montenegro is not necessary. Vaccination against jaundice A and B and against tetanus can be considered. The Embassy of the Czech Republic in Podgorica recommends that tourists prepare themselves for the trip with all the necessary medicines before leaving the Czech Republic and during their stay not to underestimate potential risks, including possible serious injuries, especially in the mountains. The best connection between the airport and the center of the capital is by taxi (price approx. 15-20 EUR). The embassy does not recommend specific hotels – there are enough reviews on platforms dedicated to accommodation. In hl. the city has a number of hotels at the Western European level, while in the regions a large number of hotels meet the European standard.

Employment of citizens from the Czech Republic

The Act on Employment and Work of Foreigners (No. 22/08 Coll. of Montenegro) abolished the category of non-resident, regulates the employment of persons without citizenship of Montenegro, with the exception of specific cases defined by law. Employment of foreigners is also regulated by the Law on Foreigners (No. 12/2018 Coll. of Montenegro). Despite unemployment, which at the end of last year was 24.73% of the working-age population, the development of the Montenegrin economy cannot be achieved without foreign labor. These are primarily seasonal, especially summer jobs, traditionally performed by employees from North Macedonia and Serbia. The level of basic (state) healthcare is lower than in the Czech Republic. A significant number of Montenegrins turn to private clinics in search of better health care. ZÚ recommends that you take out additional commercial health insurance before traveling to Montenegro.

Fairs and events

Most of the main fairs and similar events take place in the seaside town of Budva. The most famous fairs/events include: Tourism Fair, NAUTIC SHOW, Energy Fair, etc.

Montenegro Market Entry