Starting on February 13, 2017, the new Passenger Transportation Act (the “Act”) is applicable in Serbia. The Act introduces various innovations which should improve the position of public transporters, passengers and prevent unlawful practices by public transporters. The main motive for introducing the Act was the harmonization of Serbian laws with EU legislation.

One of the principal innovations is that it will now be mandatory for all transportation companies to be licensed in order to provide public transportation services. To obtain a license, the company will have to fulfill conditions regarding its business reputation, financial solvency, professional capacity, and vehicle fleet.

Another of the focus areas of the Act are the taxi drivers. The Act stipulates several new conditions regarding taxi drivers and their vehicles which should be fulfilled in order to adequately provide taxi services. From now on, each taxi driver will have to be registered with the Serbian Business Registers Agency and obtain a permit in order to operate as a taxi. Each vehicle must have no more than five seats and must be owned by a taxi driver or by a leasing company. In addition, taxi drivers shall from now on have to issue receipts to customers.

Hopefully, the new Act will have beneficial effects on public transportation and its regulation in Serbia. However, it could also reduce competitiveness in the public transportation market, since a part of transporters may not be able to fulfill some of the new obligations, which may lead to some of these companies going out of business.