New Law on Business Companies – A Modern Framework for Doing Business in Montenegro
The Parliament of Montenegro has adopted the Law on Business Companies (“Official Gazette of Montenegro”, No. 089/25 of 05.08.2025), introducing a modern and comprehensive legal framework that will significantly improve the business environment, increase legal certainty, and facilitate the functioning of business entities. This law represents a step toward harmonizing domestic legislation with European standards and creating a more favorable environment for both domestic and foreign investors.
The law comprehensively regulates the establishment, management, restructuring, termination, and other issues relevant to the operation of business companies, entrepreneurs, and branches of foreign companies. Special emphasis is placed on digitalization and procedural efficiency, thereby reducing administrative burdens and encouraging transparency in business operations.
Modern approach and digitalization of business operations
One of the key innovations is the introduction of full digitalization of the company incorporation and registration process. The law allows registration in the Central Register of Business Entities (CRPS) to be completed electronically, using a qualified electronic signature and electronic identification system.
In this way, company formation in Montenegro becomes faster, simpler, and more accessible – without the need for the founder’s physical presence.
The law also clearly defines the roles and responsibilities of management bodies, introduces more precise rules on the protection of minority shareholders, and establishes new mechanisms for preventing conflicts of interest and business misconduct.
Alignment with new regulations
The law prescribes transitional periods during which existing business entities and entrepreneurs must adjust their operations to the new rules.
Specifically, all legal entities and entrepreneurs registered in the CRPS are required to:
- align their organization, internal acts, and business practices with the new law,
- make changes and update data in the CRPS,
- do so within three months from the date the law enters into force.
Additionally, joint-stock companies that have ordinary shares of different nominal values are required to homogenize their shares within one year, ensuring uniformity and proportionality of ownership in the company’s capital.
These measures aim to ensure consistency and transparency in the operations of all companies, strengthening market integrity and aligning practices with international standards of corporate governance.
Organization and accountability in business
The law introduces clearer rules regarding the functioning and responsibility of management bodies, particularly in relation to:
- liability of directors and executive bodies for the legality of operations,
- the obligation to report conflicts of interest,
- restrictions on capital management and protection of shareholder rights,
- obligations for record-keeping and business documentation retention.
Additionally, rules are prescribed for company restructuring, mergers, divisions, and changes of legal form, as well as for cases of dissolution and liquidation.
Particular importance is given to the protection of creditors and the preservation of business stability during reorganization.
Transitional provisions and entry into force
Restructuring procedures and share issuances initiated before the application of this law will continue and be completed in accordance with the regulations in force at that time, ensuring legal certainty and business continuity.
The law enters into force on the eighth day following its publication in the “Official Gazette of Montenegro” and will apply as of January 1, 2026.
This provides businesses with sufficient time to prepare and align their operations with the new provisions.
On the date of application of the new law, the previous Law on Business Companies (“Official Gazette of Montenegro”, Nos. 65/20, 146/21, and 4/24) ceases to apply.
Support and implementation
In the coming period, the Ministry of Finance and other competent institutions will adopt by-laws to ensure the precise implementation of the law. Our agency will, as always, keep clients and business entities informed in a timely manner about all updates, deadlines, and practical steps required for business compliance.
Other categories