General overview of debt securities market in Serbia

So far, financial activities on debt securities market in Serbia have been relatively scarce, mostly limited to short term debt securities issued by the State, local authorities or other public institutions. In effect, private companies as issuers have been left aside and hardly ever induced by the legislation to use this tool of finance. In general, it seems that the culture of capital markets, like the one in USA or some EU countries, is still not recognized enough in Serbia. But perspectives exist.

Government response to economic hardship brought by COVID-19 pandemic

As part of the package of economic measures announced by the State, the Government of Serbia adopted the Regulation on the Procedure for Issuance of Debt Securities (“Regulation”), applicable from 10 April 2020, temporarily easing the legislative structure on debt securities market during COVID-19 pandemic. Clearly, the Government wanted to allow companies to have expanded alternatives, when it comes to finding capital resources during economic hardship.

Key features of the debt securities temporary scheme under the Regulation

In summary – simplification of the prospectus and documents to be included therein, speeding of the process of issue, and the temporary character of the scheme are what this Regulation comes to. The digest of these features is the following:

  • The prospectus is to be issued as a single prospectus, not to include the summary one. The publicly available data on the issuer, including financial and audit reports, may be presented only by reference, though the list of all referred documents and website location availability thereof must be clearly included in the prospectus. This does not apply to the last annual financial report with auditor’s report, as well as to the last consolidated financial report and annual management report, if applicable, and these have to be included in the prospectus. Providing the semi-annual financial report would not be required if the last annual financial report relates to the period of 200 days before the application for approval of the prospectus has been filed to the Securities Commission (“the SEC”).
  • The SEC is to approve the prospectus within 10 business days of receipt of orderly application. Also, the SEC is to regulate the form and minimum content of the information to be included in the prospectus, within 15 days as of the Regulation coming into force.
  • The Regulation shall be applicable only to decisions on issue of debt securities adopted during the state of emergency and within 180 days following the cessation of the state of emergency. Therefore, the Regulation could potentially extend to almost entire 2020. Successful issuer shall be given a temporary status of a public company (if not already) during the validity of the issued debt securities, and in case of non-listed joint stock companies there will be no obligation on listing.


Government’s approach to debt securities seems to be a rather optimistic attempt at boosting debt securities market in the atmosphere of utter market uncertainty brought by the pandemic. The main question is – will there be a demand for such securities in the Serbian underdeveloped world of capital markets? However, once the pandemic ends, the Government should consider this Regulation as a starting point for motivating investors and issuers to focus on Serbian debt securities market.