Types of companies in BiH

Types of companies in BiH

The Company Law of the Federation of B&H (Official Gazette of FBiH No. 81/15 and 75/21) and the Company Law of Republic of Srpska (Official Gazette of RS No. („Službeni glasnik RS“, br. 127/08, 58/09, 100/11, 67/13, 100/17, 82/19 i 17/23) regulate the establishment, operation and termination of businesses in Bosnia and Herzegovina.

 

Type of company Federation of B&H Republic of Srpska
Unlimited Joint Liability Company (d.n.o. / o.d) Founded by the establishment contract of two or more partners, domestic or foreign, natural persons only. Founders are liable to use all their assets, including personal property. There are no requirements for minimum or maximum contributions; Founded by the establishment act of two or more domestic/foreign natural and/or legal partners who commit to do certain activity under the same company name, with their own unlimited solidary liability for company commitments. There are no requirements for minimum or maximum contributions;
Limited Liability Company (d.o.o.) Founded by the establishment act or establishment contact by one or more domestic/foreign natural and/or legal entities with initial capital divided in a parts. A member in a limited company is liable for the value of his investment in that company. Minimum initial capital is 1,000 BAM (approx. 500 EUR); Founded by the establishment act of one to hundred domestic/foreign natural and/or legal entities.  Shareholder in a limited company is not personally liable for any of the debts of the company, other than for the value of his investment in that company. Minimum initial capital is 1 BAM (approx. 0,5 EUR);
Limited Partnership (k.d.) Company founded by the establishment contract of two or more domestic/foreign natural and/or legal entities. There must be at least 1 partner with full liability (including private property) and at least 1 partner with limited liability, the liability being limited by the value of his share in that company. There are no requirements for minimum or maximum initial capital; Founded of two or more domestic/foreign natural and/or legal entities by the establishment act; one person at least has unlimited liability for the company, and one person at least has liability to the amount of his/her investment in the company. There are no requirements for minimum or maximum initial capital;
Joint-Stock Company (d.d. /a.d.) Legal entities founded by the establishment contract of one or more domestic/foreign natural or legal shareholders with initial capital divided into shares.Joint stock companies may be open or closed Open joint stock companies are companies whose shares have been issued by means of public offering and which meet one of the following criteria:a) they are banks or insurance companies, or b) they  have  share  capital  at  least  in  the  amount  of  4 milion KM (approx.. 2 mil eur) and  at  least  40 shareholders. Closed joint-stock company is a legal entity whose shares are distributed among a limited number of shareholders. The min. initial capital is 50,000 BAM (approx. 25,000 EUR).

Legal entity founded by the establishment act of one or more domestic/foreign natural and/or legal entities with initial capital divided into a defined number of shares. 1. Open joint-stock company is a legal entity, whose shares may be publicly traded i.e. offers its shares for sale upon the open market and they are listed on the stock exchanges and other public markets. The minimum initial capital is 50,000 BAM (25,000 EUR); 2. Closed joint-stock company is a legal entity, whose shares are distributed among a limited number of shareholders. The minimum initial capital is 20,000 BAM (10,000 EUR).
Testimonials & Success Stories
 

Global Investment Promotion Best Practices 2012 of the World Bank has cited one example of support that FIPA provides to foreign investors who are running business in Bosnia and Herzegovina in order to contribute to increase the flow of foreign capital in the country.

The article said:  

„The Foreign Investment Promotion Agency (FIPA) of Bosnia and Herzegovina was an early convert to the idea of providing facilitation services to agribusiness investors as a way to maximize the positive impact of agriculture on the economy.

In 2007, for example, FIPA assisted a Dutch food processing company establish a US$1.6 million production facility to process unused milk ingredients into value-added products in Sarajevo to sell to markets in Eastern Europe and the Middle East.

As part of its aftercare program, FIPA assisted the company with its expansion plans. Among other things, the agency helped facilitate veterinary permissions, navigate various bureaucratic hurdles and played an important role in securing funding for the company’s expansion. It also helped develop a network of local suppliers and customers. As a result of these efforts, the Dutch investor developed stronger links with the Bosnian economy, thus increasing the positive spillover effects on the local economy.

Currently a new investment to establish a drying facility for milk powder is under way. This will further expand the processing facilities of unused milk ingredients. This additional planned investment is worth approximately US$2.8 million, thus nearly trebling the company’s original investment in the country“.

 

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