Date: 27/10/2020

AmCham’s suggestions for new Serbian Government agenda to enhance public administration and accelerate recovery

Public-private synergies will ensure Serbian economy rebounds faster

The American Chamber of Commerce in Serbia (AmCham) welcomes the appointment of the new Government of the Republic of Serbia and acknowledges efforts made by all stakeholders in addressing the health challenges caused by the Covid-19 pandemic, while recognising the issues faced by the country’s economy and proposing concrete measures to overcome them.

Congratulating Ana Brnabić, the Prime Minister designate, on being appointed to her second term in office, AmCham President Zoran Petrović said initial impact of the Covid-19 pandemic on Serbia had been blunted in 2020 by the Government’s support measures. Mr. Petrović emphasised that the full effects of the crisis on the economy would become apparent over the longer period, which meant we were looking forward to working with the new Serbian Government to protect the health of the country’s citizens, safeguard jobs, and promote an efficient recovery. ‘I call on the new Government to continue improving healthcare and e-government services while enhancing the rule of law and tax predictability, as these areas were decisive for a quick rebound’, Mr Petrović concluded.

Aiming to safeguard jobs while promoting recovery, AmCham has developed four priority objectives for improving the capacity of public administration and ensuring the economy picks up as quickly as possible. These are: developing e-government; enhancing the rule of law and judicial efficiency; improving healthcare services; and increasing the predictability of taxation and parafiscal levies.

Developing e-government

An efficient e-government significantly reduces administrative costs for both government and businesses while at the same time promoting transparency and reducing scope for corruption. To improve online services, the Government should:

• Allow submissions in all administrative procedures (court proceedings, employment interactions, and the like) to be made online, without subsequently requiring paper documents.
• Reduce red tape that constrains foreign exchange payments, collections, and credit transactions, in co-ordination with the Tax Administration.
• Allow full online communication with all border authorities, including inspections services, and integrate them into the Customs Administration information system.
• Hire the necessary staff and provide specialised training to inspections services to allow them to control illicit online trade, especially in medicines and medical devices.
• Permit exchange of information between the public and the private sector to reduce the administrative burden on transactions (such as in banking), on the pattern of EU models.

Enhancing the rule of law and judicial efficiency

The general public and businesses wish to see a nation founded upon the rule of law, a country where all individuals and firms are equal, and an efficient and independent judiciary is both a precondition and touchstone of such a society. To attain this objective, Serbia ought to:

• Automate service of process and ensure service information is available online to avoid postponing court hearings due to failure to serve process, and, for the duration of the pandemic, allow more proceedings to take place using videoconferencing facilities.
• Extend the e-Sud (‘e-Court’) case management software to cover courts other than the Administrative Court, as well as enforcement bodies, while consolidating case law and making it available online.
• Ensure court teams are specialised in particular areas, using efforts invested by the Commercial Appellate Court as an example. (The Administrative Court should especially gain specialists in tax procedures, antitrust rules, and the like.) Offer continuing education to these teams in each area of specialisation.
• Align local case law with judgments of the European Court of Justice to ensure legal protection is available when local laws harmonised with EU rules are implemented.

Improving healthcare services

With the health service under tremendous strain, its development requires additional investment and sustained efforts to address the challenges it faces. Doing so requires a set of measures that ought to facilitate access to innovative drugs and technologies for patients, promote public-private synergies to increase healthcare accessibility, and optimise public procurement and inventory tracking. If it is to meet these goals, Serbia should:
• Provide sufficient capacity for on-demand PCR testing in the workplace at the height of the pandemic to permit businesses to better manage their operations. This should include swabbing on company premises.
• Expand access to healthcare and treatments for chronic and urgent non-Covid-19 patients during peaks in the pandemic by using telemedicine solutions and harnessing public-private synergies.
• Ensure all administrative procedures for licensing, license renewal, and approval of variations and promotional materials are completed within statutory time limits. Support ALIMS, the regulator, in aligning its new online licensing management platform with these time limits, and consider hiring new staff and relaxing procedures to achieve this objective.

Increasing the predictability of taxation and parafiscal levies

A predictable system of taxes and parafiscal dues is a key sign that potential investors look for when deciding where to take their business. To retain and attract domestic and foreign investment, the government should:

• Ensure the fiscal and parafiscal burden does not increase, as well as reduce it wherever possible, while consistently deploying all incentives for businesses.
• Make any changes to tax regulations only following public consultation and broad-based dialogue with businesses, and guide implementation of tax rules using comprehensive secondary legislation instead of relying on the current system of official opinions.
• Regulate tax aspects of e-invoicing and introduce a trial period for e-invoices of at least nine months.