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Ease of Doing Business in

Serbia

Serbia Download Profile (1742.2KB, pdf)
Region Europe & Central Asia
Income Category Upper middle income
Population 7,098,247
GNI Per Capita (US$) 5,500
City covered Belgrade

190

1

DB 2017 Rank

1

100

DB 2017 DTF (% points)

  • local_library
  • group
Topics DB 2017 Rank DB 2016 Rank info_outline Change in Rank DB 2017 DTF (% points) info_outline DB 2016 DTF (% points) info_outline Change in DTF (% points) info_outline
Overall 47 54 up
7
72.29 69.58 down
2.71
Starting a Business 47 62 up
15
91.67 88.94 up
2.73
Dealing with Construction Permits 36 152 up
116
76.30 56.89 up
19.41
Getting Electricity 92 73 down
19
69.93 72.39 down
2.46
Registering Property 56 72 up
16
71.31 66.95 up
4.36
Getting Credit 44 42 down
2
65.00 65.00
-
Protecting Minority Investors 70 69 down
1
56.67 56.67
-
Paying Taxes 78 98 up
20
74.36 69.90 up
4.46
Trading across Borders 23 24 up
1
96.64 96.64
-
Enforcing Contracts 61 53 down
8
61.41 63.96 down
2.55
Resolving Insolvency 47 48 up
1
59.66 58.52 up
1.14

Positive= Doing Business reform making it easier to do business.Negative= Change making it more difficult to do business.

DB 2017 Rank:

47

DB 2016 Rank:

48

Change in Rank:

up1

DB 2017 DTF (% points):

59.66

DB 2016 DTF (% points):

58.52

Change in DTF (% points):

up1.14

Indicator Serbia Europe & Central Asia OECD high income
Recovery rate (cents on the dollar) info_outline 32.5 38.2 73.0
Time (years) info_outline 2 2.2 1.7
Cost (% of estate) info_outline 20 13.1 9.1
Outcome (0 as piecemeal sale and 1 as going concern) info_outline 0 .. ..
Strength of insolvency framework index (0-16) info_outline 13.5 9.9 12.1
  • Indicator Explanation Answer
    Recovery rate (cents on the dollar) 32.5
    Proceeding As Mirage management wants to keep the hotel operating, it will petition the court to commence reorganization proceedings - either pre-packaged reorganization under Article 155 or regular reorganization under Article 162 of the Bankruptcy Law. As all creditors vote on the reorganization plan and BizBank is the principal creditor, the Bank is likely to reject the claim, which will trigger mandatory liquidation proceedings under Article 165 of the Bankruptcy Law. liquidation (after an attempt at reorganization)
    Outcome As the hotel is unable to repay its loan to BizBank and expects negative cash flow for the next two years, it is then unlikely that the hotel will continue operating. Additionally, continuous operation is only possible if reorganization plan is approved, which is not likely in this case. piecemeal sale
    Time (in years) It takes approximately 2 years to resolve insolvency in Serbia. Mirage management will file a petition for reorganization. It will take at least 6 months for all the procedures related to reorganization to take place, for the plan to be proposed and rejected by the creditors. 90 days for submitting reorganization plan, which can be extended up to 120 days (which is very common). Once the plan is filed, the court is required to schedule a hearing in 20 days, which is usually prolonged up to 30-60 days. All creditors vote on the reorganization plan. As BizBank is the principal creditor, the Bank is likely to reject the claim, which will trigger mandatory liquidation proceedings. The proceedings will then be converted into liquidation. Then, the Court will appoint an administrator to review creditors' claims, prepare a preliminary balance sheet and a list of creditors. . Creditors can then dispute the administrator's decision on accepting or denying their claims. Once all the claims are finalized, the creditors will take a decision on whether to sell the hotel as a going concern or to sell the assets separately. The administrator will then organize an auction, where assets will be sold. After the sale, another hearing will take place to finalize the distribution list, after which the proceeds of the sale will be distributed. 2.0
    Cost (% of estate) Major expenses include remuneration of the insolvency representative (both regular fees and percent of the realized assets) - up to 9-15%; attorneys' fees - up to 6%, Auctioneer’ fees: 1-2% 20.0
    Answer Score
    Strength of insolvency framework index (0-16) 13.5
    Commencement of proceedings index (0-3) 2.5
    What procedures are available to a DEBTOR when commencing insolvency proceedings? (a) Debtor may file for both liquidation and reorganization 1.0
    Does the insolvency framework allow a CREDITOR to file for insolvency of the debtor? (b) Yes, but a creditor may file for liquidation only 0.5
    What basis for commencement of the insolvency proceedings is allowed under the insolvency framework? (c) Both (a) and (b) options are available, but only one of them needs to be complied with 1.0
    Management of debtor's assets index (0-6) 6.0
    Does the insolvency framework allow the continuation of contracts supplying essential goods and services to the debtor? Yes 1.0
    Does the insolvency framework allow the rejection by the debtor of overly burdensome contracts? Yes 1.0
    Does the insolvency framework allow avoidance of preferential transactions? Yes 1.0
    Does the insolvency framework allow avoidance of undervalued transactions? Yes 1.0
    Does the insolvency framework provide for the possibility of the debtor obtaining credit after commencement of insolvency proceedings? Yes 1.0
    Does the insolvency framework assign priority to post-commencement credit? (b) Yes over ordinary unsecured creditors but not over secured creditors 1.0
    Reorganization proceedings index (0-3) 3.0
    Which creditors vote on the proposed reorganization plan? (b) Only creditors whose rights are affected by the proposed plan 1.0
    Does the insolvency framework require that dissenting creditors in reorganization receive at least as much as what they would obtain in a liquidation? Yes 1.0
    Are the creditors devided into classes for the purposes of voting on the reorganization plan, does each class vote separately and are creditors in the same class treated equally? Yes 1.0
    Creditor participation index (0-4) 2.0
    Does the insolvency framework require approval by the creditors for selection or appointment of the insolvency representative? No 0.0
    Does the insolvency framework require approval by the creditors for sale of substantial assets of the debtor? Yes 1.0
    Does the insolvency framework provide that a creditor has the right to request information from the insolvency representative? No 0.0
    Does the insolvency framework provide that a creditor has the right to object to decisions accepting or rejecting creditors' claims? Yes 1.0

Note: Even if the economy’s legal framework includes provisions related to insolvency proceedings (liquidation or reorganization), the economy receives 0 points for the strength of insolvency framework index, if time, cost and outcome indicators are recorded as “no practice”.