Administrative procedures: It is not possible to re-register a trade in the FBiH into a doo

People who want to start their own business should think carefully about the needs of their business before starting. Based on that, they should make a decision whether it will be a trade or a limited liability company. If they decide to trade, and their business develops over time, they cannot re-register it as a limited liability company. There is no such legal possibility.

“Trade and limited liability company are two different legal forms. However, future entrepreneurs can first establish a business if they are not sure and do not want to take big steps at the beginning, because establishing a limited liability company requires more effort, money and paperwork than establishing a business, so after a certain time they can formally and legally shut down that business and establish a limited liability company. ,  lawyer Alena Begović, MA ,  told

He emphasizes that trade can be a supplementary activity in addition to regular and permanent employment. On the other hand, serious businesses generally require the establishment of a doo, which entails larger and more serious obligations.

Craft activities can be carried out at home, while a doo requires a seat, that is, an address where it will be registered. This entails the obligation to enter into a Lease Agreement with the lessor, rent for the premises if you are not lucky enough to be the owner of a business premises and to register the headquarters of the company at that address.

“Also, a limited liability company requires a certified accountant, that is, external bookkeeping, while in the case of trades, future entrepreneurs can keep their own books,”  explained the lawyer.

Some types of trades, such as e.g. dental practices must have business premises with a purpose, they must meet special conditions prescribed and defined by the competent Ministries for starting a business.


Shutting down the business and opening a limited liability company

The procedure for shutting down a trade is much simpler and faster than the procedure for shutting down or closing a limited liability company. A trade is a much simpler legal form than a doo

“The procedure for closing a trade is carried out by the competent registration body, specifically in the competent municipalities for independent entrepreneurs, and by the competent Ministries for trades with a special purpose. When shutting down a business, the most important thing is that you have no outstanding obligations to the state, and then everything goes faster. The procedure lasts about 15 days,”  she said.

The procedure for opening a limited liability company depends on the activity it will be engaged in. This entails additional obligations and additional paperwork, if it is a question of activities that require permits from competent state authorities – ministries.

“Once the necessary documentation is obtained, the procedure at the Municipal Court, specifically in Sarajevo, takes between 10-30 days,”  she pointed out.

The biggest problem is administration and administrative procedures that take too long. It would be a great relief for all entrepreneurs if the system in municipal, cantonal, federal and state institutions was integrated. Then entrepreneurs would not have to go to 100 addresses in order to collect the necessary documentation.

“I hope that the introduction of the electronic signature is actually the beginning of the real digitization of the administration and judiciary in Bosnia and Herzegovina, and that the problem of crowding at the counters and in front of administrative bodies will finally be solved, which will facilitate and speed up administrative procedures, which are really a big problem for all entrepreneurs”,  lawyer Begović believes.

 The big “nonsense” he points out is that 18 years have passed since the adoption of the Law on Electronic Signatures of Bosnia and Herzegovina, and citizens of Bosnia and Herzegovina can use electronic signatures and digital identities only from 2024.

“Unfortunately, this is another indicator of the slowness of the system, which of course affects all potential entrepreneurs who, even if they have an idea, give up starting their own business due to administrative procedures and vicissitudes,”  she said.