Historically, Serbian securities law has been unclear on whether foreign issuers could offer employee share schemes in Serbia. In this regard, the Serbian Securities Commission (the "SEC") had issued several opinions indicating that any type of notification related to employee share schemes provided to employees in Croatia would be considered a public offer under local securities laws, triggering the need for compliance with local registration and prospectus requirements.

In a recent positive development, the Serbian SEC issued an opinion in March 2019 providing that in instances where employees in Serbia initiate the desire to receive equity compensation awards and participate in equity compensation plans offered by a foreign parent company, any subsequent grant or offer to participate by the foreign parent company to the employees in Serbia would not be treated as a public offering in Serbia and would not trigger the local registration and prospectus requirements. Rather, the offering would be deemed to be occurring outside of Serbia. In furtherance of the Serbian SEC’s opinion, companies seeking to grant equity compensation awards to employees in Serbia should take specific steps to document the local workforce’s interest in receiving equity compensation awards and participating in equity compensation plans. For example, employees in Serbia should express their interest in stock plan participation by sending some type of written notice (either hard copy or electronic) that ultimately is received by the foreign parent company (either directly or via its local subsidiary in Serbia).