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INVESTMENTS

There are many reasons for investing in BiH, such as:

  • Stable financial sector
  • Favorable Trade and other Agreements
  • Favorable Tax and Customs System
  • Availability of skilled, educated and competitively priced labor force
  • An abundance of premises and sites, industrial zones, free trade zones
  • Foreign Investor Support Fund etc.

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Regarding his investment the foreign investor enjoys equal status, rights and duties, as domestic legal and physical persons. A foreign investor enjoys full legal security and legal protection in respect of rights acquired by virtue of the investment. Rights of foreign investor acquired in the moment of registration of the legal documents cannot be deteriorated by subsequent alteration of laws and other regulations.

Company with foreign investment enjoys equal legal status and carries on its business under equal conditions and in an equal manner ad do domestic companies.

Foreign citizens in BiH shall exercise the same rights and freedoms as citizens of BiH, provided for by the legislation of the country ( in competence of Ministry of Justice BiH)

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Foreign investors concerned about risks of transfer restrictions, expropriation, war and civil disturbance and denial of justice, can be insured against these risks with the European Union Investment Guarantee Trust Fund for Bosnia and Herzegovina, administered by the Multilateral Investment Guarantee Agency (MIGA, member of the World Bank Group).

BiH is eligible for assistance from the US Overseas Private Investment Corporation (OPIC), which also provides political risk insurance for investors.

 

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Corporate income tax rate is 10 % on the whole territory of Bosnia and Herzegovina.

Personal Income Tax- from 5,5 % to 30%

Property tax. – From 3-8 %

Value Added Tax – 17 %

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Work permits for foreign investors are issued on the basis of residence permit.

Work permits are issued by the authorized Employment Offices for the maximum period of up to one year and can be extended.

The employer should apply for work permits for their foreign employees. Work permits are issued for the person for specified position and with specified employer for specified period of time. The employment of foreign national will be permitted if he is qualified for the position and if no unemployment citizen of BiH can be found to fill the vacancy. With the termination of employment, the corresponding work permit is invalidated.

The permit evaluation process needs to be completed 7 days upon the submission of required documents.

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Money transfer to Bosnia and Herzegovina goes through banks directly or via intermediary banks, depending on the sender’s location.

Cash that exceeds 10.000 EUR must be reported at the border or airport.

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  • Foreign investors are protected against nationalization, expropriation, requisition or measures having similar effects; such measures may take place only in the public interest in accordance with the applicable laws and regulations and against the payment of an appropriate compensation, i.e. compensation that is adequate, effective and prompt.
  • National treatment of foreign investors, i.e, foreign investors have the same rights and obligations as residents of B&H.
  • Foreign investors are entitled to open accounts in any commercial bank in domestic and/or any freely convertible currency on the territory of B&H.
  • Foreign investors are entitled to freely employ foreign nationals, subject to the labour and immigration laws in B&H.
  • Foreign investors are entitled to transfer abroad, freely and without delay, in convertible currency, proceeds resulting from their investment in B&H
  • Foreign investors may own real estate in B&H. Foreign investors enjoy the same property rights in respect to real estate as B&H legal entities.
  • The rights and benefits of foreign investors granted and obligations imposed by the Law on the Policy of Foreign Direct Investment (mentioned above) cannot be terminated or overruled by subsequent laws and regulations. Should a subsequent law or regulation be more favorable to foreign investors, the investor will have the right to choose the regime by which the investment will be regulated.
  • Full corporate income tax exemption for companies whose exports exceed 30% of total income (turnover)
  • Companies investing not less than  20 million BAM over five consecutive years in production, provided the investment during the first year is at least  4 million BAM .
  • A company, whose workforce is comprised more than 50% of persons with disabilities or special needs hired for a period longer than one year, is exempt from corporate income tax for that year.
  • Foreign investors concerned about risks of transfer restrictions, expropriation, war and civil disturbances and denial of justice, can be insured against these risks with the European Union Investment Guarantee Trust Fund for Bosnia and Herzegovina, administered by the Multilateral Investment Guarantee Agency (MIGA, member of the World Bank Group).

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