Digital nomads, cyber risk insurance, and an ever-growing energy sector – these are the hottest topics in Montenegro right now, according to CMS Partner Milica Popovic.
“The most interesting topic in Montenegro right now are digital nomads,” Popovic begins, “and the fact that the government has canceled the requirement that businesses pay for healthcare.” She reports that, from a business standpoint, this has attracted attention from foreign investors to open up shop in Montenegro. “I would expect that the final legal framework dealing with digital nomads in Montenegro will end up looking like the one in Croatia,” Popovic continues, indicating that it is expected for this to occur in 2022. “In Croatia, digital nomads are not required to pay any income tax but, on the flip side, must not work for Croatian employers.”
As another interesting development, Popovic underlines an increase in the number of legal questions regarding insurance matters. “This is not a highly visible topic, but there has been an uptick in legal matters dealing with professional liability insurance and cyber risk insurance,” she says.
On the one hand, professional liability insurance, according to Popovic, has mostly to do with the increase in the number of large infrastructural projects that are currently in development. “A great number of foreign investors, contractors, and subcontractors have come to Montenegro to work on these – especially in the energy sectors,” she says. “And they are all required to obtain appropriate insurance, so the uptick in this area is logical.”
On the other hand, Popovic says that cyber risk insurance is becoming an inevitability. “It might, at first, appear that many businesses in the region are not fully aware of all the cyber threats out there – but the pandemic has made sure that awareness gets raised,” she says. “I expect the cyber risk insurance sector to grow even more, and for us to witness an increase in cooperation between large insurance companies and IT companies, such as Google, Microsoft, or Apple.”
Popovic foresees that all business sectors that rely on IT solutions will, at one point, be forced to form their own cyber risk assessment teams. “The market is becoming more and more aware of the immediate risk that cyber-attacks represent – and is preparing to react,” Popovic says. “Once there is a realization of a cyber risk – you have to be ready to react within hours.”
Finally, on insurance, Popovic adds that there was an increase in the number of legal questions surrounding business interruption policies as well. “The key question a lot of clients ask was if there was a legitimate business interruption situation in the case where countries have applied restrictive measures to combat the pandemic – mostly in the hospitality industry.” She says that, ultimately, the answer to that question was 'no', but that an increase in work occurred nonetheless.
In conclusion, Popovic highlights a steady trend of growth in the energy sector of Montenegro. “There is a markable growth, especially in solar and wind power, with a few wind and solar power energy parks under construction.” Additionally, Popovic says that a fact-finding study on Montenegro’s energy supplies on the seaside should be completed in near future. “We are expecting to see the results of this study by the end of the year – it should provide information on whether Montenegro has any oil reserves at its disposal.”