Published on and written by Cyril Jarnias
Montenegro, a small Balkan country on the Adriatic coast, is attracting more and more foreign entrepreneurs thanks to its business-friendly environment and advantageous tax system. Discover in this comprehensive guide why and how to establish your company in Montenegro in 2025.
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Montenegro, a Paradise for Entrepreneurs
Montenegro offers numerous advantages to entrepreneurs looking to set up their business there. Here are the main reasons that make this country an attractive destination for company formation:
A booming economic environment: Since its independence in 2006, Montenegro has implemented reforms aimed at attracting foreign investment. The country shows sustained economic growth, with GDP rising by 4.1% in 2024. The tourism, services, and new technology sectors are particularly dynamic.
A highly advantageous tax system: With a corporate tax rate of only 9%, Montenegro offers one of the most attractive tax systems in Europe. Additionally, the country has signed numerous tax treaties to avoid double taxation.
Simplified procedures: Setting up a business in Montenegro is relatively simple and quick. Administrative procedures have been largely simplified in recent years, allowing company registration in just 5 business days on average.
A strategic geographical position: Located at the crossroads of the Balkans, Montenegro offers privileged access to Central and Eastern European markets. The country also has modern infrastructure, including the deep-water port of Bar.
A pleasant living environment: With its spectacular landscapes between sea and mountains, Montenegro attracts many entrepreneurs seeking a better quality of life. The cost of living is also very affordable compared to Western Europe.
Good to know:
Montenegro is a candidate for European Union membership, which should strengthen its economic attractiveness in the coming years.
Main Legal Structures in Montenegro
Montenegrin company law offers several options for establishing a business. Here are the main legal forms available to you:
Limited Liability Company (DOO): This is the most common form for SMEs. It can be established by one or more persons, with a minimum share capital of only €1. The liability of partners is limited to their contributions.
Joint Stock Company (AD): This structure is suitable for larger-scale projects. The minimum share capital is €25,000. Shares can be listed on the stock exchange.
Sole Proprietorship (Preduzetnik): This form is suitable for entrepreneurs wishing to operate under their own name. It offers great management simplicity but does not provide protection of personal assets.
Branch (Ogranak): Foreign companies can open a branch in Montenegro without creating a separate legal entity. The branch does not have its own legal personality.
Representative Office: It allows a foreign company to have a local presence for non-commercial activities (prospecting, marketing).
For most foreign entrepreneurs, the Limited Liability Company (DOO) is the most relevant choice. It offers a good balance between management simplicity and legal protection.
Good to know:
It is possible to establish a single-member company in Montenegro, which is perfectly suitable for individual entrepreneurs wishing to limit their liability.
Attractive Taxation for Businesses
The Montenegrin tax system is particularly advantageous for companies. Here are the main taxes to know:
Corporate Tax: The standard rate is 9%, one of the lowest in Europe. SMEs with annual revenue of less than €100,000 benefit from a reduced rate of 3%.
VAT: The standard rate is 21%. A reduced rate of 7% applies to certain essential goods and tourist services.
Personal Income Tax: Salaries are subject to a progressive rate ranging from 9% to 15%. Dividends are taxed at 9%.
Social Security Contributions: They amount to approximately 33% of gross salary, with 24% borne by the employer.
Property Tax: Its rate varies between 0.1% and 1% of the property value depending on the municipality.
Montenegro has also implemented tax incentives for certain strategic sectors:
- Corporate tax exemption for 3 years for companies establishing in special economic zones
- 25% tax credit for investments in the manufacturing industry
- Reduced VAT rate of 7% for luxury hotels
Good to know:
Montenegro applies the territoriality principle. Only income from Montenegrin sources is taxable, which is very advantageous for companies with international activities.
Establishing Your Company in Montenegro: Step-by-Step Guide
The company formation procedure in Montenegro is relatively simple and quick. Here are the main steps to follow:
1. Choose a name for your company: Check its availability with the Central Registry of Business Entities (CRPS).
2. Draft the articles of association: They must be written in Montenegrin and signed by all partners.
3. Open a temporary bank account: To deposit the share capital.
4. Register with the CRPS: Submit your complete file (forms, articles of association, identity documents, etc.). Registration is generally completed within 5 business days.
5. Obtain a tax identification number: From the Montenegrin tax administration.
6. Register with social security organizations: For social security contributions and health insurance.
7. Obtain necessary licenses: Depending on your activity, specific permits may be required.
The total cost of establishing a company in Montenegro is relatively low, generally between €300 and €500 excluding consulting fees.
It is highly recommended to engage a local lawyer or specialized firm to assist you with these procedures, particularly for document translation and dealings with the administration.
Good to know:
It is possible to establish your company entirely online via the Montenegrin government’s eUprava portal, which significantly speeds up the process.
Montenegro vs. Other Offshore Jurisdictions
How does Montenegro position itself compared to other popular destinations for offshore company formation? Here’s a comparison with some competing jurisdictions:
Montenegro vs. Cyprus: Montenegro offers a lower corporate tax rate (9% vs. 12.5% in Cyprus) and simpler procedures. However, Cyprus benefits from its EU member status.
Montenegro vs. Dubai: Both destinations offer very advantageous taxation. Dubai has the advantage of being a major international hub, but Montenegro offers easier access to the European market.
Montenegro vs. Malta: Malta offers an advantageous tax refund system for shareholders. Montenegro stands out for its administrative simplicity and lower cost of living.
Montenegro vs. Bulgaria: Both countries have a 10% corporate tax rate, but Montenegro offers faster procedures and an overall more favorable business environment.
Montenegro stands out for its unique combination of tax advantages, administrative simplicity, and quality of life. Its strategic geographical position also makes it an ideal gateway to Balkan markets.
Good to know:
Montenegro is not considered a tax haven by the OECD, which gives it a better reputation than some traditional offshore jurisdictions.
Social Obligations for Employers
If you plan to hire staff in Montenegro, here are the main social obligations to know:
- 24% borne by the employer
- 9% borne by the employee
Health Insurance: The employer must enroll employees in mandatory health insurance.
Paid Leave: The legal minimum is 20 working days per year.
Working Hours: The standard work week is 40 hours, with a maximum of 10 hours per day.
Minimum Wage: It is set at €450 gross per month in 2025.
Termination: A minimum notice period of one month is required. Severance pay is due after 18 months of service.
Montenegrin labor law is generally favorable to employers, offering some flexibility in human resources management.
Good to know:
Montenegro offers hiring incentives for companies recruiting recent graduates or long-term unemployed individuals.
Opening a Corporate Bank Account in Montenegro
Opening a bank account is a crucial step for your company in Montenegro. Here’s the procedure to follow:
1. Choose a bank: The main banks operating in Montenegro are CKB (Crnogorska Komercijalna Banka), Erste Bank, and NLB Bank.
- Company registration certificate
- Articles of association
- Identity documents of directors and shareholders
- Proof of company address
- Account opening application form
3. Schedule an appointment with the bank: Physical presence of the director is generally required.
4. Interview and document verification: The bank will conduct checks as part of anti-money laundering procedures.
5. Account activation: Once the file is validated, your account will be opened within 2 to 5 business days.
Montenegrin banks generally offer efficient online banking services, facilitating the daily management of your operations.
Good to know:
Some banks offer special packages for newly established companies, including reduced fees during the first months of operation.
Promising Sectors in Montenegro
Montenegro offers numerous business opportunities in various sectors. Here are the most promising areas for entrepreneurs in 2025:
Tourism and Hospitality: The tourism sector is booming, with an average annual growth of 8%. Opportunities are numerous in luxury hotels, ecotourism, and business tourism.
Information Technology: The Montenegrin government has made digital development a priority. Startups in e-commerce, fintech, and artificial intelligence are particularly sought after.
Renewable Energy: Montenegro aims to produce 33% of its electricity from renewable sources by 2026. Projects in wind and solar power benefit from attractive tax incentives.
Organic Agriculture: Demand for organic products is rising sharply. Montenegro has vast agricultural lands suitable for this type of cultivation.
Business Services: With the influx of foreign investors, consulting, accounting, and translation services are in high demand.
Manufacturing Industry: The government encourages investments in light industry, particularly in the textile and food processing sectors.
Good to know:
Montenegro has established free zones offering additional tax advantages for industrial and exporting companies.
Recruiting Qualified Staff in Montenegro
To ensure the success of your business in Montenegro, it is essential to be able to recruit competent staff. Here are some tips for successful recruitment:
Utilize local recruitment platforms: The most popular job sites in Montenegro are Prekoveze.me and Zaposli.me. They will allow you to reach a wide pool of candidates.
Collaborate with universities: Montenegro has several reputable universities, notably the University of Montenegro in Podgorica. Establishing partnerships with these institutions can help you recruit young talent.
Engage specialized recruitment agencies: Firms like Manpower or Adecco are present in Montenegro and can assist you in your search for qualified profiles.
Offer attractive benefits: Although salaries are generally lower than in Western Europe, Montenegrin employees are sensitive to benefits like supplementary health insurance, performance bonuses, or work flexibility.
Consider international recruitment: For certain specialized positions, it may be wise to expand your search internationally. Montenegro offers simplified procedures for obtaining work permits for qualified foreign employees.
Invest in training: Since the Montenegrin labor market is relatively limited, it may be interesting to recruit junior profiles and invest in their training to develop their skills.
Good to know:
Montenegro has a generally well-trained workforce, with a good level of English, which facilitates the integration of international teams.
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Cyril Jarnias is an independent expert in international wealth management with over 20 years of experience. As an expatriate himself, he is dedicated to helping individuals and business leaders build, protect, and pass on their wealth with complete peace of mind.
On his website, cyriljarnias.com, he shares his expertise on international real estate, offshore company formation, and expatriation.
Thanks to his expertise, he offers sound advice to optimize his clients' wealth management. Cyril Jarnias is also recognized for his appearances in many prestigious media outlets such as BFM Business, les Français de l’étranger, Le Figaro, Les Echos, and Mieux vivre votre argent, where he shares his knowledge and know-how in wealth management.
