Investing in Montenegro

Montenegro is a safe, economically viable, and politically stable country with strong potential for continued growth. It boasts political stability and multi-ethnic harmony. With two international airports, four seaports—one connecting globally—and developed road and rail infrastructure, the construction of the Bar-Boljare highway positions Montenegro among the top investing in Montenegro destinations in the region.

EU Integration and Trade Agreements

Montenegro has signed key international agreements to boost its economic appeal. Indeed, it became a candidate for EU membership in 2012, with negotiations opening that year. Moreover, it joined NATO in 2017, enhancing security and stability. For most countries, there is no visa regime, and Montenegrin citizens enjoy visa-free travel to EU/Schengen countries and 125 others.

  • Montenegro has signed the Central European Free Trade Agreement (CEFTA) on July 26, 2007. Free-Trade Agreement between Montenegro and members of the European Free Trade Association (EFTA) was signed in November 2011.
  • Candidate country for membership of the EU –On 29 June 2012, at the Summit in Brussels, heads of states and governments of the EU confirmed the opening of negotiations on Montenegro’s accession to the EU.
  • Montenegro has officially become a member of NATO in June 2017.
  • For most countries, there is no visa regime in Montenegro. Montenegro citizens can travel to all the EU/Schengen countries without Visa as well as to 125 countries with visa-free or visa on arrival access.

Business Environment and Legal Framework

Company Registration in Montenegro

Foreign legal and natural persons can establish companies under the same conditions as nationals. Consequently, the most common forms are limited liability companies (LLC) and joint stock companies (JSC).

  • limited liability company (LLC);
  • joint stock company (JSC).

Treatment of Foreign Investors

Foreign investors may invest in any industry and freely transfer funds, assets, and profits. They enjoy national treatment, meaning equal status with domestic investors. Foreign investors include foreign persons or entities, companies with over 25% foreign capital, and Montenegrin citizens abroad for over 12 months.

Foreign investments are implementable through:

  • Setting up of a new company (independently or together with other investors);
  • Investing in existing companies;
  • Setting up a foreign company branch;
  • Purchase of a company.

Tax System and Financial Incentives

Tax System

The tax system for foreign investors mirrors that for local entities. Corporate income tax is 9%, and personal income tax rates are 9% or 11% for higher wages. After paying corporate tax, businesses can transfer funds abroad annually.

VAT rates include a standard 21% and reduced 7% for essentials like food and medicines. A zero rate applies to exports and certain health items. Real estate transfer tax is 3% of the tax base.

VAT Refund

If output tax is lower than input VAT, the difference becomes a tax credit or is refunded within 60 days upon request. Export-focused taxpayers or those with excess input VAT for three consecutive periods get refunds within 30 days.

Incentive Measures

To boost investing in Montenegro, the government offers financial incentives for new investments. Projects worth at least €500,000 creating 20+ jobs, or €250,000 in less developed regions creating 10+ jobs, qualify for support. Foreign investors can access these funds by establishing an entity in Montenegro.

National-level incentives include tax exemptions for corporate and personal income, plus subsidies for hiring unemployed persons. This makes investing in Montenegro more attractive for businesses.

Incentive Programme for Business Development – Business Zones

The government promotes business development through zones that encourage micro and small enterprises. Investors use utility-connected premises for coordinated operations, reducing costs through shared resources. Moreover, they receive tax exemptions, administrative facilitations, and logistical support to ease business operations.