Member Article

The Government of Serbia adopted the Regulation on the Procedure for Issuance of Debt Securities (“Regulation”). This is one of the economic measures presented to reduce the negative effects caused by the COVID-19 pandemic and an attempt to support the economy of Serbia. The Regulation entered into the force on 10 April 2020.

The Regulation introduces certain changes regarding debt securities’ issuance – with the intention to simplify this process. However, it seems that these bonds will not be guaranteed by the state, so it remains to be seen if these will be used in practice at all (having in mind related costs and current appetite for rather risky investments).

Prospectus form/content

• Prospectus needs to be me made as a single document;
• Prospectus does not contain a summary prospectus;
• Certain publicly available information, as well as the information from financial and auditor’s report, can be incorporated in the prospectus by a reference; and
• In case that the last annual financial report refers to the period of 200 days before the date when the prospectus is filed with the Serbian Securities Commission (“SEC”), the issuer does not have to prepare the semi-annual report.

Public company status

• If the public offer is successful, the issuer will obtain the status of a public company and keep it for the time of debt security’s validity (unless it was a public company already); and
• Such a public company (i.e. joint-stock company) is not required to admit its shares on a regulated market or MTF.

Timeline

• SEC will issue a decision on approval of the publication of a prospectus within 10 business days following the satisfactory receipt of the application;
• SEC should shortly adopt a by-law for implementation of Regulation (within 15 days from entering of Regulation into force); and
• Regulation will be applicable if the company has adopted a decision on issuance of debt securities: (i) during the state of emergency; or (ii) within 180 days from the end of the state of emergency.

The information in this document does not constitute legal advice on any particular matter and is provided for general informational purposes only.