Few things to know before starting a business in Montenegro

1. Decide if it’s really a limited company that you need

One of the most prevalent forms of companies in Montenegro is the limited liability company (DOO). Nowadays, the LLC is particularly relevant for the reason that the foreigners can become land owners in Montenegro only being in the status of a legal entity for some time now.

But before going any further, give a little thought to whether a limited company is the best form for your business to take.

A private limited company does have a number of important advantages – possessing most of the legal rights of an individual and offering substantial protection to shareholders from the liabilities of the business. But there’s also a need to maitain company records and file accounts and other documents with.

f you want more information, check out our article about why so many people form limited companies for their business.

2. Choose a good company name

Choosing a name for your business is a crucial step. You want to make sure it is understandable and conveys what you do, while also being catchy enough for people to remember. It can take time to find just the right name.

Once you decide on a name, you need to register it so that your company’s identity is protected.

Registering your business name is an important step and one that offers a variety of protections. Taking this step formalizes your business and helps ensure no one else can use your name.

Once you decide on a name, you need to register it so that your company’s identity is protected.

To avoid confusion, state laws prohibit two companies from having similar names, so think of a few options you are willing to use in case your top choice is unavailable.

Registering your business name is an important step and one that offers a variety of protections. Taking this step formalizes your business and helps ensure no one else can use your name.

3. Assemble the details needed to register the company

There’s several pieces of information that you’ll need to have available in order to register a new company. You can refer to our new company registration checklist for the full list, but the information needed mostly relates to the following:

A Monteengro registered office address– to which Companies House will direct official mail and which appears on the publically available company record
What the company plans to do – at least one SIC codedescribing the anticipated activities of the business must be provided
Details of the share capital to be created – for a private company limited by shares, at least one euro.
Company director and – there must be at least one human director aged at least 16 for a new private limited company
Initial shareholderdetails – there must be at least one initial shareholder, who can be the same person as a company director

For each shareholder, as well as basic details you’ll need a few pieces of identifying information for security purposes – any of the person’s National Insurance number, eye colour, telephone number, mother’s maiden name, father’s first name and passport number.

Details of people with significant control over the company must also be provided. These may include anyone with more than 25% of the shares in the company or other individuals or relevant legal entities.

4. Prepare Memorandum and Articles of Association

The memorandum and articles of association collectively make up the constitution of the company.

By completing the memorandum of association, which is a short document which tends to include a number of standard clauses, the subscribers to the initial shares confirm their agreement to start a company. The memorandum of association must be filed with Companies Selecta as part of registering a company.

The articles of association are the “rule book” of the company, defining how the company is to be run by the directors on behalf of the shareholders. A great number of companies adopt the private company Model Articles which cover most circumstances. If there are unusual requirements the company can instead adopt bespoke articles – in those cases, it’s worth seeking legal advice.

The memorandum and, in the case of bespoke variants, the articles of association must be filed with Companies House when registering the company. This can be done electronically rather than sending paper copies and a system like Inform Direct will create, fill in and send these documents automatically.

For those bravest souls who want to read more about these documents, in another article we look in detail at the memorandum and articles of association.

6. Wait for the company formation to be approved

You can’t start to operate the business as a limited company until you receive approval from Companies House, who will undertake some checks of the information you’ve submitted.
If you register a new company using online , the process of approval will take longer.

7. Set up company registers (and then maintain them)

The law requires each company to set up and then maintain company books, which include:

You can buy template paper registers to fill in by hand. Better still, straightforward online products like Inform Direct will automatically update electronic statutory registers whenever you made changes to the company, its officers and shareholders.

8. Other tasks to do once the company has been registered

There’s a number of other important tasks you’ll want to consider once the company has been successfully registered, which might include:

Setting up a bank account
Registering with HMRC, which may include registering for VAT
Registering and setting up PAYE for employees
Setting up a website, particularly if you want customers to find you online
If it’s important to your particularly business, registering a trade mark

If you’re looking to register a new company, we hope you find it a rewarding experience. Whether you’re starting your first company or are a company registration veteran, we’d love to hear any ideas and tips: contact us with details and we’ll look to share them with other readers.

More information:

To learn more about starting or buying a business http://www.companyformationmontenegro.me/

If you need some more info, e-mail us selecta.me@gmail.com

Mob: 00382 69 590 433

If you believe a company in Montenegro can help you in your business, please ask for details. We will be happy to advise.