A limited liability company is a company in which one or more members hold shares in the company’s capital, with the members being liable for the company’s obligations up to the amount of their monetary or non-monetary contributions to the company (except in cases where the legal personality is pierced). A limited liability company is certainly one of the most common forms of business organization in the Republic of Serbia. The limited liability of the members makes this form of company particularly attractive for anyone planning to engage in a specific business activity.
The members of a limited liability company regulate their mutual relationships within the company, as well as their relations with the company, freely in accordance with the provisions of the Companies Act.
A limited liability company can be a single-member or multi-member company. If it is a single-member company, it is established by adopting a Decision on the establishment of the limited liability company (a unilateral legal act). If it is a multi-member company, it is established by an Agreement on the establishment of the limited liability company, concluded by the members of the company. The founding act must contain the content prescribed by law, and it may also be amended during the company’s operation.
The status of a company member is acquired on the day of registration of ownership of the share in accordance with the law on registration, and it ceases on the day of registration of the termination of the member’s status in accordance with the law on registration. Members of the company may freely dispose of their share in the company, respecting the pre-emption rights stipulated by law in favor of other members of the company. Members of the limited liability company acquire a share proportionally to the amount of their contribution to the company. Based on their acquired share, members have certain rights within the company, such as: the right to vote, the right to participate in the company’s profit, the right to participate in the liquidation remainder, as well as other rights provided by law. The grounds for the termination of membership in a limited liability company are: the death of an individual member/termination of a legal entity, withdrawal from the company, exclusion of a member, transfer of the entire share, withdrawal, and annulment of the share.
The company’s minimum capital is 100 dinars, unless a special law prescribes a higher amount of capital for companies performing specific activities. Therefore, the Companies Act prescribes an almost symbolic amount of initial capital that the company must maintain at all times.
The company management can be organized as unicameral or bicameral. In the case of unicameral management, the company’s organs are: the assembly and one or more directors. In the case of bicameral management, the company’s organs are: the assembly, the supervisory board, and one or more directors.