Category: Serbia

The National Assembly of the Republic of Serbia adopted several proposed laws related to construction during its session on 26 July 2023.

These are:

1. The Law on Amendments and supplements to the Law on Spatial Planning and Construction, which came into force on 4 August 2023; then
2. The Law on supplements to the Law on Legalization of Buildings, which came into force on 28 July 2023; and
3. The Law on Cessation of Validity of the Law on Special Procedures for Realization of Projects of Construction and Reconstruction of Linear Infrastructural Objects of Special Importance of the Republic of Serbia, which came into force on 4 August 2023.

The highest level of attention is given to the amendments and supplements to the Law on Spatial Planning and Construction. We have already discussed these amendments while the same was still in the phase of law proposal.

The most significant amendments and supplements to the Law on Spatial Planning and Construction address the matter of conversion, i.e. conversion of the right of use of the construction land to ownership right without remuneration. The obligation to pay conversion fees is now abolished for a significantly larger group of entities than before. This matter was discussed in more detail in the text available at the above link.

Besides this amendment, the amendments and supplements to the Law on Spatial Planning and Construction give special attention to the matters of energy efficiency, green agenda and to the protection of natural resources and cultural heritage. For example, now it shall be mandatory to obtain the certificate on energy properties of the building, i.e. separate part of the building, for the purposes of certification of the real estate sale-purchase agreement, as well as for the purposes of execution of the agreement on real estate lease.

The participation of competent organizations for the protection of nature and organizations for the protection of immovable cultural heritage is enhanced, especially in the procedures of preparation and adoption of spatial planning documents. The law introduces the notion of “green building”, “green building certificate”, as well as the notion of “green infrastructure”. The Government of the Republic of Serbia should, on the basis of the proposal of the Ministry of Construction, Traffic and Infrastructure, and pursuant to the authorization granted to it by the law, determine the incentives for green building. The investors shall be incentivized to pursue green building through the reduction of contributions for the development of construction land for facilities for which the green building certificate is issued.

The amendments and supplements of the Law on Spatial Planning and Construction introduce the establishment of the Agency for Spatial Planning and Urbanism of the Republic of Serbia, as the public agency, the establishment of a chief state urban planner and chief urban planner of the autonomous province, who shall be in charge for control of spatial and urban planning documents. Also, the amendments extend potential entities that are authorized for issuance of the information on location.

Also, simultaneously with the adoption of the Law on Cessation of Validity of the Law on Special Procedures for Realization of Projects of Construction and Reconstruction of Linear Infrastructural Objects of Special Importance of the Republic of Serbia, the amendments and supplements of the Law on Spatial Planning and Construction implement thereof provisions that tackle certain important matters for construction of linear infrastructural objects that are recognized as linear infrastructural objects of special importance for the Republic of Serbia.

As per the Law on supplements to the Law on Legalization of Buildings, the adopted supplements are good news for the owners of illegally constructed facilities, and especially for the owners of illegally constructed residential buildings, or of the apartments in the illegally constructed buildings. Their buildings may be temporarily connected to the utility and electric grid network of public companies, regardless of when these buildings were constructed.

By Ivan Petrovic, Head of Real Estate department and Marija Vukcevic, Senior Associate, JPM & Partners

The new amendments to the law on foreigners and the law on the employment of foreigners, which will apply from 1 February 2024 (“Amendments”), significantly simplify and shorten the procedure for employment of foreign citizens in the Republic of Serbia and contribute to increased efficiency of the procedure, which will allow foreigners to be employed in the Republic of Serbia in a very short period of time.

Single permit

Namely, unlike the previous solution, which implied a previous obligation to regulate temporary residence, and then submit a request for a work permit, the Amendments introduce a single permit which will represent both a temporary residence permit and a work permit.

A single permit will be issued in a single procedure, conducted entirely before one authority – the Ministry of Internal Affairs of the Republic of Serbia. Within this single procedure, the competent authorities will carry out all necessary assessments and, if all conditions are fulfilled, issue a single permit.

The National Employment Service also participates in the process of issuing a single permit, by checking the fulfillment of the conditions for employment of a foreign citizen, as a form of preliminary opinion in the process of issuing a single permit. All of the evidence necessary to assess the fulfillment of the conditions for issuing a single permit will also be submitted electronically.

A single permit may be issued for a period of up to three years. Also, temporary residence, regardless of its basis, in accordance with the Amendments, may be approved for a period of up to three years, instead of the previous period of one year.
The Amendments specify in which situations a foreign citizen has the right to work in the Republic of Serbia without obtaining a single permit, i.e., certain categories of foreigners with regulated residence in the Republic of Serbia are granted the right to work without the obligation to obtain a single permit. These include primarily foreigners who have been granted temporary residence on the basis of ownership of real estate, on the basis of family reunification with a member of the immediate family of a citizen of the Republic of Serbia, as well as other categories of foreign citizens.

Digitization of the procedure

In addition, one of the significant novelties is the complete digitization of the procedure for issuing or extending a single permit, which significantly speeds up the procedure and contributes to its efficiency, and also enables the submission of requests from abroad. Namely, the submission of requests for the issuance of a single permit will be done electronically, through a publicly accessible web portal.

Labor market test

In addition, the Amendments are also significant for employers who employ foreign citizens directly, having in mind that the request for conducting the labor market test will also be submitted electronically on the web portal.

Biometric document

Further, the Amendments stipulate that the single permit, as well as the approval for temporary residency will be issued in the form of a biometric document, instead of the temporary residence sticker in the foreign citizens passport.

Temporary residency

For certain categories of foreigners who submit a request for approval of temporary residence in the Republic of Serbia, the procedure is further facilitated by the fact that they are exempted from the obligation to submit proof of means of subsistence and proof of health insurance during the planned stay in the Republic of Serbia. This benefit applies to the foreign citizen who is a member of the immediate family of a Serbian citizen and to the foreign citizen who submits an application based on employment.

Permanent residency

Also, the procedure for approval of permanent residency in the Republic of Serbia is changed. First of all, permanent residency may be granted to a foreign citizen after three years of continuous residency on the territory of the Republic of Serbia, instead of the previous five-year period. Also, a foreigner who has been granted permanent residency in the Republic of Serbia will have the right to work in the Republic of Serbia without a single permit.

In addition, it is important to emphasize that the application for permanent residency will also be submitted electronically.

D Visa

Work engagement of foreign citizens in the Republic of Serbia is also simplified for foreign citizens who apply for a long-term visa (D Visa). Namely, they are enabled to be employed immediately upon arrival to the Republic of Serbia, having in mind that D Visa issued on the basis of employment, simultaneously represents a residence and work permit during the period of validity of the issued visa, up to a maximum of 180 days. This change means that the authorities participating in the visa approval process will carry out all the necessary assessments and determine whether the conditions for issuance are met, while the foreign citizen is still abroad.

By Katarina Savic, Senior Associate, JPM & Partners

The new Law on Electronic Communications, published on April 29, 2023, in the Official Gazette of the Republic of Serbia no. 35/23, went into force on May 7, 2023. With the entry into force of the new law, the previous Law on Electronic Communications ceases to be valid (“Official Gazette of the Republic of Serbia”, nos. 44/2010, 60/2013, 62/2014 and 95/2018) except for certain provisions related to the secrecy of electronic communications, legal interception, and retention of data, as well as other specific provisions that will be valid until the adoption of by-laws prescribed by the new Law on Electronic Communications.

The Law on Electronic Communications (“Law”) has been vastly harmonized with the European Electronic Communications Code (“EECC”) and it is believed that it will create a modern business environment according to the EU standards, accompanied by positive effects on the economy and citizens’ standard of living.

Aim

The aim of the Law is creating conditions for the even development of electronic communications throughout the territory of the Republic of Serbia and encouraging connectivity, access, wide availability and use of new generation networks (5G), especially very high capacity networks, including fixed, mobile and wireless networks, protection of competition in the provision of electronic communication networks, as well as ensuring constant improvement of the quality of electronic communications services.

Novelties introduced by the Law

Some of the most significant novelties for business entities and citizens introduced by the Law are:

Encouraging wider connectivity to the internet through country

The Law prescribes the role of the Government in terms of closer regulation and undertaking incentive measures for the development of broadband communication infrastructure in rural areas of the Republic of Serbia, ensuring the provision of electronic communication services, especially universal service to certain categories of consumers (socially vulnerable consumers, etc.).

Regulatory treatment of new very high-capacity network elements

The Law introduces provisions that regulate co-investment in very high-capacity networks and the regulatory treatment of very high-capacity network elements.

New mandatory obligation of investors

The Law introduces the obligation of investors, when constructing or reconstructing buildings with several business or residential units, to build the first collection or distribution point of the network inside the building or outside it in order to enable access to the infrastructure inside the building.

The approach to the radio frequency spectrum and numbering has been improved, which encourages the introduction of new services and increases competitiveness on the market

The Law emphasizes the neutrality of the right to use radio frequencies, that is, the right to use radio frequencies that are not subject to restrictions in terms of technology, as well as in terms of the types of electronic communication services provided. A more consistent distribution of the radio-frequency spectrum will ensure the timely and appropriate availability of the spectrum for the application of the 5G network, which is currently not provided in Serbia.

Possibility of assigning a numbering range to entities which do not perform the activity of electronic communications

The Law prescribes the possibility of assigning a numbering range to entities which do not perform the activity of electronic communications, such as IoT service providers for the provision of special services (smart homes, smart cars, etc.) with a potentially very large user base, and enables, if it is technically possible, long-distance number portability, in order to make it easier for end users to change operators, especially with M2M services.

Obligation of operators to issue invoices in electronic form

The Law introduces the obligation of issuing invoices in electronic form. The provider of a publicly available electronic communication service issues an invoice to the end user in electronic form without the need for the end user’s prior consent. This will reduce costs and will have a positive impact on the environment.

Mandatory registration of prepaid service users

The Law introduces the registration of users of the public mobile communication network who use the prepaid service. The main goal of introducing registration is, first of all, to prevent misuse of electronic communications.

Summary

Overall, the introduction of Serbia’s new Law on Electronic Communications represents a significant step towards an advanced digital society. By harmonizing with the EECC and introducing new features, Serbia has established a forward-thinking regulatory environment that supports innovation, empowers consumers, and fosters competition.

By Tanja Dugonjic, Partner, Bojanovic & Partners

As we previously reported, the pivotal Energy Community Ministerial Meeting held in Tepelenë, Albania, in June signaled potential developments in green energy and decarbonisation in the Western Balkans (WB).

High-ranking officials, including Energy Community Contracting Parties ministers, European Commission representatives, and Energy Community Secretariat members, converged at the Informal Ministerial Council Meeting to deliberate on salient energy issues, with the centerpiece being the Energy Community Decarbonisation Roadmap, which aims to establish a regional emissions trading system (“ETS”) and set ambitious decarbonization targets.

These talks hold immense importance in implementing the Carbon Border Adjustment Mechanism Regulation (“CBAM”), specifically in the electricity sphere.  Dialogue and cooperation in carbon pricing and a regional ETS are crucial steps toward achieving the objectives outlined in the Decarbonisation Roadmap adopted in 2021. The recent adoption of the EU CBAM Regulation reinforces existing commitments and boosts the support for the transition towards green energy.

The Status Quo in WB

All WB countries demonstrated their alignment with EU’s energy and environmental standards, including carbon pricing, by signing the Sofia Declaration on the Green Agenda for the Western Balkans in 2020 (“Sofia Declaration”). The Sofia Declaration emphasized harmonization with the EU Emissions Trading System (“EU ETS”) and exploring additional carbon pricing methods to advance decarbonization in the region.

According to the Western Balkans Regular Economic Report: Spring 2023, considerable milestones have been reached since the Sofia Declaration.  Albania, Bosnia and Herzegovina, Montenegro, North Macedonia, and Serbia have all adopted measuring, reporting, and verification (“MRV”) legislation for greenhouse gas (“GHG”) emissions, paving the way for national carbon pricing frameworks.  Montenegro has gone further and introduced a national ETS in 2020, covering the power and industrial sectors, with a minimum price of a single emission allowance of 24 EUR.  Bosnia and Herzegovina is exploring the national carbon pricing system potential design options.  Serbia and North Macedonia conducted impact assessments, while Albania’s carbon pricing system is under consideration.

In all WB jurisdictions, however, indirect carbon pricing measures are in place, reflecting policies that convey either a positive or negative pricing signal, such as fossil fuel subsidies (representing negative pricing) and excises (representing positive pricing).

Is the WB Ready for CBAM Exemption?

As the CBAM Regulation’s transition phase looms in October 2023, the Energy Community Secretariat has released the CBAM Readiness Tracker. This new report evaluates the strides made by the Energy Community Contracting Parties to attain CBAM exemption prerequisites.  The report’s findings suggest that while WB nations are on track, more work is needed to avoid CBAM certificate charges on electricity imports. The CBAM Regulation allows for a time-limited exemption for electricity imports into the EU until 2030, provided the Contracting Party’s electricity market is coupled with the EU and meets specific criteria regarding climate and energy legislation.  Six conditions must be met for electricity-related CBAM exemption:

1. An agreement with the EU necessitates an obligation to apply EU law in electricity.  This includes legislation on the development of renewable energy sources and other regulations in energy, environment, and competition. All Contracting Parties meet this condition by virtue of being signatories to the Energy Community Treaty.
2. Domestic legislation must incorporate the following:
   • EU Electricity Market Provisions: All contracting parties have satisfied this condition. The Energy Community laws have seamlessly integrated the most recent EU electricity market acquis, aiming for transposition by the close of 2023.  However, several Contracting Parties have reported delays in drafting, which might lead to missing the transposition deadline.
   • Renewable Energy Sources: WB countries are advancing in adapting the Renewable Energy Directive (RED II).  Both Albania and Bosnia and Herzegovina have amended their Renewable Energy Source (RES) Acts, partially adopting the RED II.  Montenegro is currently crafting its inaugural stand-alone RES Act.  North Macedonia has taken steps to incorporate the RED II into its Energy Act.  Serbia, meanwhile, has updated its RES Act and is working on subsequent legislation.
   • Electricity Market Coupling: The Contracting Parties have yet to synchronize their electricity markets with the EU’s internal electricity market.
3. Presenting a 2050 climate neutrality roadmap to the European Commission and ETS – this condition remains unfulfilled.
4. A commitment to achieving climate neutrality by 2050 is essential – this mandate calls for parties to outline a comprehensive strategy to reduce GHG emissions, which must be presented to the United Nations Framework Convention on Climate Change (UNFCCC) and incorporated in national law. As of now, within the WB countries, only North Macedonia has relayed its comprehensive GHG emissions strategy to the UNFCCC, and none of the parties have implemented this directive. Yet, as the 2021 Decarbonisation Roadmap by the Ministerial Council indicates, the Contracting Parties are unanimously inclined towards achieving climate neutrality by 2050.
5. A commitment to establish an ETS – a key condition is integrating carbon pricing at a level mirroring that of the EU, especially concerning electricity generation.  Numerous Contracting Parties are streamlining their climate policies in line with EU guidelines.  Albania, Montenegro, and Serbia have ratified climate-specific laws.  North Macedonia is making notable progress, with a refined draft already available for public consultation.  It’s noteworthy that only Montenegro has instituted carbon pricing, albeit at rates significantly lower than the EU ETS.  The impending objective for all Contracting Parties is the initiation of an ETS priced on par with the EU ETS by 2030.
6. Curbing Indirect Electricity Imports – establishing a robust mechanism to deter the indirect influx of electricity into the EU from other external nations or regions is a requisite.  Currently, none of the Contracting Parties have developed such a system.

Navigating a Greener Future

Despite significant progress in greenhouse gas emissions regulation and the adoption of EU electricity market legislation, challenges remain for the Contracting Parties in securing the CBAM electricity exemption.  Time is of the essence, given the relative exposure of the WB jurisdictions and potentially significant economic implications of the full application of CBAM regulation.  Yet, the challenges are not unsurmountable, and the WB has a strong potential to align with the EU ETS framework through a fundamental understanding of the ramifications of the CBAM regulation, sustained commitment, and resolve.

By Branko Gabric, Counsel, Vasilije Boskovic, and Nikola Ivkovic, Associates, Gecic Law

On April 28, 2023, symbolically on the International Day for Safety and Health at Work, the National Assembly of the Republic of Serbia adopted the New Law on Safety and Health at Work (“Official Gazette of the RS”, No. 35/2023 – hereinafter: the New Law), which entered into force on May 7, 2023. The New Law brings a large number of novelties in the field of safety and health at work (hereinafter: OSH), and its main goal is the complete alignment of OSH regulation with European standards, and consequently, a significant reduction in the number of injuries at work and occupational diseases of employees.

The most important novelties carried by the new Law on Safety and Health at Work are reflected in the following:

1. Working from home and working remotely

For the first time in the field of OSH the institute of work from home and remote work is regulated. It envisages the obligation of employers to carry out risk assessment and prescribe measures for safe and healthy work from home and remote work, whereby the employee is given the opportunity to participate in the risk assessment process.

The obligation of the employee was also established to inform the employer about the fulfilment of the conditions for safe and healthy work from home and remotely.

2. Mandatory training of employees

The New Law introduces mandatory training in the field of OSH, including the obligation of employers to conduct and train employees for the proper use of equipment for safe work.

In particular, the employer is obliged to carry out the training of employees: 

• when establishing an employment relationship, i.e. other kind of work engagement;
• transfer to other jobs;
• when introducing new technology or new means of operation or changing work equipment; and
• when changing the work process.

During the training for safe and healthy work, the employer is obliged to inform the employee about the risks in the workplace to which he is determined and about the specific measures for the OSH in accordance with the risk assessment act.

3. Work permits for high-risk business activities

Certainly, one of the most important novelties of the New Law is the introduction of the obligation of employers to, as a special preventive measure, regulate the manner of issuing a work permit that they are obliged to provide to every employee who performs work at height, in depth, in areas with potentially explosive atmospheres, on energy facility, when using dangerous chemical substances, work in areas where there is a serious, unavoidable or immediate danger or harm that can endanger the health of the employee.

The regulation of the procedure for issuing a license for work in high-risk activities is at the disposal of employers.

4. Medical examinations

The employer is obliged to refer the employee to a medical examination at his request, no later than five years after the previous examination. Also, the obligation of the employer was introduced to provide the employee who performs work at night with a periodic and preliminary medical examination. The cost of medical examinations is borne by the employer.

5. Refusal of further work of the employee

Cases are prescribed in which an employee may refuse further work, i.e. when his safety and health at work is at risk. Also, the employee has the right to contact the competent labour inspection if the employer does not act on the request for elimination of risks for OSH.

Furthermore, it is stipulated that an employee may leave his workplace if he is threatened with a serious, unavoidable and imminent danger to life or health, and in that case he will not be placed in an adverse situation, nor will he be liable to the employer for compensation of damage, if he did not cause the damage intentionally or out of gross negligence.

6. E-register of injuries at work and the obligation to report to the competent inspection

A new register of injuries at work is being introduced, established and maintained by the Administration for Safety and Health at work in electronic form. 

Employers are now obliged to immediately, and no later than 24 hours after their occurrence, orally, in writing or electronically report to the competent work inspection and the competent authority of the Ministry of the Interior affairs any fatal, collective or serious injury at work, as well as any dangerous phenomenon that could endanger the safety and health of employees.

Also, employers are now obliged to immediately, and no later than 5 working days from the date of its occurrence, report to the competent work inspection a minor injury at work due to which the employee is not fit to work for more than three days, and within 5 days from the date of delivery of the appropriate opinion of the health institution, to report to the competent work inspection the determined occupational disease. 

7. Organizing the work of OSH according to the New Law

Organizing the work of OSH according to the New Law The manner of organizing OSH has been completely changed by the New Law, with the introduction of the institute of advisors (person for OSH in high-risk activities), and associates (person for OSH in less risky activities). Now organizing work in this area can be carried out in three different ways:

1. Internal – Employment agreement with an advisor/associate, who are obliged to have passed the professional exam and a license;
2. External – By engaging legal entities or entrepreneurs who have a license to perform occupational safety and health activities, and who themselves determine the personality of the advisor / associate, and their number;
3. Independently – Employers who perform service activities, if they have up to 20 employees and passed the professional exam, can independently implement the measures of the OSH, for which they do not need a license.

In addition, it is mandatory for employers with a larger number of employees (over 250, or 500 employees), to hire more than one advisor / associate depending on the activities they are engaged in.

8. Enhanced surveillance

The New Law tightened supervision and strengthened the powers of the competent work inspection in order to ensure the effective implementation of the New Law. Thus, an important novelty is the authorization of the work inspector to ban the investor from working on the entire construction site when he determines that the safety and health of the employee are directly endangered. The ban may last as long as circumstances that lead to the endangerment of the safety and health of the employees exist, but not less than 3, 15 or 30 days, depending on how many times the circumstances that lead to the endangerment of safety and health at work on the construction site are determined. 

9. Tightening of penal policy

In terms of penal policy, the novelty in relation to the previous Law is the prescribing of fines in a fixed amounts and a significant tightening of existing fines. The maximum fines have doubled and as many as 73 different misdemeanours have now been prescribed for breaches of the New Law.

Transitional provisions Finally, it should be emphasized that, although the New Law has already entered into force, a greater number of its provisions will apply only after the relevant bylaws have been adopted.

The deadline for their adoption is 18 months from the date of entry into force of the New Law, and employers have been left with two years to harmonize their business with its provisions.

Until then, the relevant provisions of the applicable bylaws will remain in force. Regardless of the above, all other provisions of the New Law that do not depend on bylaws are already in direct application.

By Marko Ilic, Senior Associate, JPM & Partners

Karanovic & Partners has advised DS Smith on its acquisition of Serbian offset cardboard packaging and blister packaging company Bosis.

DS Smith is a British multinational packaging business headquartered in London and listed on the London Stock Exchange. It is a provider of sustainable packaging solutions, paper products, and recycling services worldwide.

Situated approximately 100 kilometers south of Belgrade, the family-owned Bosis business was founded in 1982 and employs 140 people working on a single site in Valjevo.

Following the completion of the share-transaction acquisition of Bosis, DS Smith’s total packaging operations in Eastern Europe will comprise 29 box plants and additional facilities, employing more than 7,000 people in the region, the company announced.

“Following 41 years of successful, responsible, and sustainable business, during which Bosis grew from a small family-owned screen printing shop […] the time came for a new phase in the development of Bosis,” Bosis Founder and Owner Bogoljub Pantelic commented. “We are sure that this is the right decision for our family and Bosis, our employees and their families, as well as our long-term business partners and local community.”

The Karanovic & Partners team included Partners Milos Jakovljevic and Bojan Vuckovic, Senior Associate Marko Culafic, and Associate Mladen Vujic.

On July 10, 2023, the European Commission (“Commission“) adopted its adequacy decision for the EU-U.S. Data Privacy Framework (“DPF”). The decision concludes that the United States (“US”) ensures an adequate level of data protection – comparable to that of the European Union (“EU“).

What does this mean for EU Individuals and Businesses?

The much-anticipated decision brings a conclusive resolution to the legal uncertainties surrounding the export of EU users’ data by US companies, an issue that has troubled thousands of businesses in recent years. The General Data Protection Regulation (“GDPR“) empowers the Commission to determine, through an implementing act, whether a non-EU country ensures an “adequate level of protection” for personal data equivalent to that provided within the EU. With the new adequacy decision in place, personal data can now flow securely and freely from the EU to US companies participating in the EU – US DPF, eliminating the need for additional data protection measures like Standard Contractual Clauses (“SCC“) or Binding Corporate Rules (“BCR“).

Fundamental Principles of the Novel EU-U.S. Data Privacy Framework

A new set of rules and binding safeguards limit access to data by US intelligence authorities to what is necessary and proportionate to protect national security; US intelligence agencies will adopt procedures to ensure effective oversight of new privacy and civil liberties standards;
A new two-tier redress system to investigate and resolve complaints of Europeans on access to data by US Intelligence authorities, which includes a Data Protection Review Court (“DPRC“). Individuals can submit a complaint to their national data protection authority, even if they don’t know if US intelligence agencies collected their data. Afterward, DPRC will independently investigate and resolve complaints, including by adopting binding remedial measures;
Strong obligations for companies processing data transferred from the EU include the requirement to self-certify that they adhere to the standards through the US Department of Commerce.
US companies can join the EU-U.S. DPF by pledging to adhere to a comprehensive set of privacy obligations. These obligations include deleting personal data when it’s no longer necessary for the original purpose of collection and ensuring the continuous protection of data shared with third parties.

The EU-U.S. DPF introduces enforceable measures that address the concerns highlighted by the Court of Justice of the European Union (“CJEU”) in its Schrems II decision of July 2020. These measures include restricting access to EU data by US intelligence services to what is essential and proportionate and establishing DPRC to handle complaints from European individuals regarding collecting their data for national security reasons.

Compared to the Privacy Shield, the new Framework brings about significant improvements. For instance, if the DPRC determines that data was collected violating the new safeguards, it will have the authority to mandate the deletion of such data. The enhanced safeguards related to government access to data will complement the obligations required of US companies importing data from the EU.

EU individuals will benefit from several redress mechanisms if US companies wrongly handle their data. The safeguards put in place by the US will also facilitate transatlantic data flows more generally since they also apply when data is transferred by using other tools, such as SCCs and BCRs.

Looking to the Future

The adequacy decision came into effect upon its adoption on July 10, 2023. To ensure the ongoing protection of personal data belonging to individuals in the EU, the Commission will conduct periodic reviews of the EU-U.S. DPF. The first review is scheduled to occur within a year of the EU-U.S. DPF’s operation.

Stay tuned for further details on the EU-U.S. DPF and the self-certification process, which will be revealed on the US Department of Commerce’s dedicated EU-U.S. DPF website. The US Department of Commerce manages and oversees the Framework, while the US Federal Trade Commission will be vigilant in enforcing compliance among US companies.

Making a Change or Putting a Band-Aid on the Data Transfer Issue?

The transfer of personal data from the EU to the US was ruled illegal by the CJEU in two landmark cases, with the latest one being Schrems II, which highlighted concerns about disproportionate access and inadequate protection of European bulk data by US security agencies. After the CJEU invalidated the previous adequacy decision on the EU-U.S. Privacy Shield, the Commission and the US government engaged in discussions to create a new framework addressing the issues.

Although the EU-U.S. DPF has been well-anticipated and welcomed by many, it is expected to face legal challenges in the future, similar to previous frameworks like Safe Harbour and the Privacy Shield. Privacy activist Max Schrems, who initiated previously mentioned cases, emphasizes that mere claims of being “new,” “robust,” or “effective” won’t suffice in the eyes of the CJEU. Further, Schrems expects the newest version of the adequacy decision “to be back at the Court of Justice by the beginning of next year,” which could “even suspend the new deal while it is reviewing the substance of it.”

Will the CJEU deliver a decisive verdict that sets the stage for a harmonious date flow relationship between the EU and the US? Only time will tell. In the meantime, data keeps flowing, and the EU-U.S. DPF holds the key to a data-sharing saga!

By Milica Novakovic and Nikola Ivkovic, Associates, Gecic Law

Nasa AIK Banka Head of Legal Aleksandra Hercl has joined Mindful Finance as Remote Head of Legal and as the Co-founder of Tesla Faktoring.

Based in Serbia, Mindful Finance is a business consultancy company. Tesla Factoring is a factoring company.

Hercl has spent a year and a half as the Head of Legal at Nasa AIK Banka, over nine years as Head of Legal with Sberbank Srbija JSC Belgrade, between 2012 and 2022, and over a year as Head of Legal with Volksbank Belgrade, between 2011 and 2012. Earlier, she spent almost nine years as Senior Legal Expert with Hypo Alpe-Adria-Bank Beograd and, earlier still, over four years in private legal practice.

The Serbian parliament has adopted new amendments to the Law on Planning and Construction (“Construction Law”), introducing a series of novelties expected to significantly impact the construction industry, urban planning, and energy efficiency.

The most important amendments are:

• abolishment of the land conversion fee,
• mandatory energy passports for all buildings,
• mandatory installation of chargers for electric vehicles,
• obligation for investors to have third-party liability insurance policies, and
• improving the electronic system for issuing construction permits.

One of the primary changes pertains to the abolishment of the land conversion fee. In practice this is expected to allow the current land users to convert their usage rights into ownership rights with no compensation, enabling further development and trade with no restrictions. Entities which have been the subject of privatization, bankruptcy or enforcement procedures as well as their legal successors will need to obtain the information on location issued by the soon-to-be-established Urban Planning and Urbanism Agency. In order to complete the conversion procedure, this information on location must verify that the purpose of the subject land is not intended for the construction of public purpose facilities or public areas. Additionally, all ongoing disputes regarding ownership rights on the land must be resolved before the conversion procedure can be finalized.

In the area of energy efficiency, the amendments to the Construction Law introduced requirements for all buildings to obtain mandatory energy passports. These passports will serve as a certification of a building’s energy efficiency and environmental impact and will be a mandatory requirement for all sales going forward. Owners of existing commercial buildings are similarly obligated to obtain energy passports for buildings or their separate units within five years from the date of implementation of these amendments.

Another key addition in this area is the mandatory installation of chargers for electric vehicles in all new buildings and parking areas. With the growing popularity of electric vehicles and the increasing need for accessible charging infrastructure, this amendment aims to promote electric mobility and reduce dependence on fossil fuels.

Moreover, the new amendments prioritize accountability and protection for all parties involved in construction projects. It is now mandatory for investors to have third-party liability insurance. This measure aims to safeguard the interests of stakeholders and provide financial security in case of unforeseen incidents.

The amendments also focus on improving the electronic system for issuing permits by introducing more accountability for meeting prescribed deadlines.

In conclusion, the new amendments to the Construction Law mark a progressive step forward in the construction sector and are expected to create a more resilient and environmentally conscious environment.

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

By Ana Lukovic, Partner, Nikola Siljegovic, Senior Associate, and Dordje Filipic, Associate, Karanovic & Partners

NKO Partners has advised CTP on its fifth acquisition of land in and around Novi Sad – and its second in the Kac industrial zone – intended for the further development of the company’s industrial property.

According to the firm, the target land covers an area of almost 10 hectares and was acquired from 16 different individuals and one legal entity.

A year earlier, NKO had also advised CTP on its first acquisition of land in the Kac area (as reported by CEE Legal Matters on July 7, 2022). Subsequently, the firm had also advised on CTP’s acquisition of around 20 hectares of land from the City of Novi Sad itself (as reported on August 4, 2022).

The NKO team was led by Senior Associate Luka Aleksic and included Partner Djordje Nikolic.