Serbia Transforms Seven Public Enterprises into Limited Liability Companies

Government Enacts Major Public Enterprise Reform

The Serbian government recently announced a significant restructuring of its public sector, transforming seven public enterprises into limited liability companies (LLCs). This decision, published in the Official Gazette around late December 2025, aligns with a comprehensive law adopted in September 2023, designed to improve the management and operational efficiency of state-owned entities.

Affected Entities and Legal Mandate

The seven public enterprises undergoing this legal transformation include key national service providers:

• Posta Srbije (postal service operator)
• Putevi Srbije (road operator)
• Srbijavode (water management company)
• Emisiona Tehnika i Veze (broadcasting infrastructure operator)
• Zavod za Udzbenike (textbook publisher)
• Javno Preduzece za Sklonista (shelter operator)
• Mreza-Most (information services provider in Kosovo and Metohija)

This change is a direct consequence of the Law on the Management of Enterprises Owned by the Republic of Serbia, adopted in September 2023. This legislation requires public enterprises to convert their legal form into either a joint-stock company or a limited liability company, with the primary goal of enhancing their management.

Objectives of the Reform

The overarching objective behind this reform is to foster better corporate governance and achieve improved business results within these state-owned entities. The government aims to increase efficiency, professionalize management, and reduce fiscal risks associated with public enterprises. This initiative is part of broader economic reforms supported by international partners such as the International Monetary Fund (IMF) and the World Bank, which advocate for a more sustainable financial path for state-owned enterprises, reduced reliance on state budget handouts, increased competition, and attraction of private investments.

Implications of the Legal Transformation

The conversion to limited liability companies means that while the legal form changes, the enterprises will continue to perform their public service activities as before. Their assets and liabilities will remain unchanged, existing contracts will stay in force, and ongoing court or other proceedings will continue without interruption. The capital assets of the former public enterprises will be converted into shares or stakes within the new LLC structure. This transformation maintains the entities' legal subjectivity and business identity, avoiding liquidation or interruption of legal continuity. The government has also amended the founding acts of these seven enterprises, defining new management bodies and capital assets.