The outbreak of COVID-19 in Serbia, which resulted in Government declared State of emergency, has strong impact on companies across all industries, creating a number of challenges that need to be addressed by the employers. Over the last few days, we’ve received many enquiries from our clients about business implications of the current situation. We present you below some of the most common ones, followed by answers that will help you in your response to the immediate key issues affecting your business.
Should you require legal support in connection with COVID-19, feel free to get in touch with us. SOG has formed a special work group that focuses specifically on legal and business implications of the epidemic, the current state of emergency, and its effects on your everyday business.
Q1: Are there any specific obligations imposed on employers in light of the declared State of Emergency due to COVID-19?
Yes. Employers must enable remote work or work from home to all employees whose work can be performed in such a manner. If the Employment Agreement or the Employment Rulebook do not stipulate remote work or work from home as a manner of performing work activities, the Employer must enact a decision for each employee to enable remote work or work from home. Employers must keep specific records of employees who work remotely or from home.
If Employers cannot organize remote work or work from home due to the nature of employee’s work activities, Employers should:
- if possible, organize work in shifts so that the employees do not overlap;
- enable business meetings to be held electronically (video link, video call, etc);
- postpone official travel in the country and abroad;
- implement enhanced hygienic measures at facilities;
- secure protective equipment for employees.
Besides the movement permit, the Employer must issue a work order to each employee on a daily basis and will be held responsible for the accuracy of information contained therein. There is a higher degree of responsibility of Employers for employees older than 65 years working within the aforementioned period.
Sick leaves have automatically been extended for 30 days.
Q2: Are there any restrictions related to movement of goods?
Movement of goods remains generally free, except for the ban on export of:
- flour, oil, semi-processed oil, whole sunflower seeds, sugar, sanitizers, soup, gloves (rubber, surgical and other), masks (paper and textile), protective suits (rubber and surgical), protective glasses, diapers, toilet and kitchen paper;
- medications produced in Serbia and those which are currently on the territory of Serbia, until 15 April 2020. Ban does not refer to medications which are produced in Serbia, but are not registered in Serbia and are meant only for foreign markets and to medications which are transit through Serbia.
Q3: Are there any restrictions related to movement of people?
Absolute ban on movement of senior citizens (citizens older than 65 years in urban areas with more than 5,000 inhabitants and citizens older than 70 years in areas with less than 5,000 inhabitants), and a limited ban on movement of other citizens between 8 p.m. and 5 a.m.
The aforementioned restrictions do not apply to: (i) licenced healthcare workers; (ii) officers on duty; (iii) persons granted a special permit for movement by the Ministry of Internal Affairs; (iv) persons in urgent need of medical assistance and two persons accompanying such person.
Starting from 20 March 2020 at 8 a.m. country borders have been closed for passenger transport in road, railroad and river transport. Exceptionally, entry may be allowed temporary in accordance with national interests and due to humanitarian reasons.
International airports in Serbia will be temporarily closed for international passenger transport. This prohibition does not refer to flights: (i) carrying goods and mail, (ii) performing search and rescue, (iii) humanitarian flights, (iv) performing urgent medical transport, (v) performing technical landing and positioning of flights registered with Flights Registry, (vi) in emergency landing and (vii) state flights and special purpose flights. Exceptionally, Minister of transport may provide exception to the aforementioned rules depending on the epidemic circumstances.
Ban on intercity public transportation and night public transport. Daily public transport remains, but will be reduced.
Gatherings in indoor spaces with more than 50 people (including sport events, theatres and cinemas, concerts, public debates, exhibitions and seminars, restaurants, night clubs) has been prohibited.
Movement of asylum seekers and irregular migrants housed in asylum centers and reception centers in Serbia is temporarily restricted, and an increased surveillance and security of these facilities established. These categories of people will be allowed to leave the facilities exceptionally and in justified cases (e.g. visit to a doctor), for a limited period, and with a special permission of the Commissariat for Refugees and Migration of the Republic of Serbia.
Q4: My business is significantly affected by the epidemic – are financial reliefs, subsidies or state aid available?
The most significant financial relief is the moratorium on loans and financial leasing (re)payments. The moratorium enters into force within 10 days as of 21 March 2020 or sooner under certain conditions.
In order to secure the stability of the financial market, the National Bank of Serbia has reduced the reference interest rate to 1.75%.
More financial reliefs, subsidies or state aid have been announced by the relevant government officials, but not specified.
Q5: Can COVID-19 be considered a case of force majeure and how does it affect obligations of parties to perform under contracts?
A pandemic, such is the one caused by COVID-19, is a typical force majeure event which may cause impossibility to perform under contracts or frustration of purpose of contracts. If this is the case, obligations of parties to perform may be affected in different ways.
Each contract must be assessed on its own terms and no general advice can be provided in this respect.
Q6: What is the current status of courts and other authorities?
Court hearings have been adjourned, except in cases requiring urgent action (e.g. temporary measures, domestic violence hearings etc.). Debt collection and other enforcement actions are suspended (with some exceptions).
Certification of signatures, manuscripts and transcripts before notaries, as well as hearings in non-contentious cases are suspended, except in particularly urgent and justified cases. Solemnization and notary public records (in Serbian: javnobeležnički zapis) of documents are still being conducted.
All competent authorities, except for the Customs Administration, certain counters of Tax Administration and Treasury Administration, public post service (PE “Pošta Srbija”) and public electricity company (PE “Elektroprivreda Srbije”), have ceased direct work with citizens and other entities and are now only working by post and email correspondence.
Q7: Are there any market restrictions imposed by the Government due to the State of emergency?
There is a limitation on purchases of protective equipment (10 masks/protective gloves per person) and disinfectants (2 large packs/5 small packs per person).
For the purpose of preventing market disruption, price control has been imposed for essential basic foodstuffs, protective equipment, disinfectants, cosmetics until 18 April 2020. Prices can only be raised within the limits of the annual inflation rate.
Export bans for certain goods and medications are also in place, as explained in detail within Q2.
Note: the measures undertaken by the Government of Serbia explained above are being adopted and/or amended on a daily basis, and in most cases with immediate effect. While we believe that our answers above are well founded and justifiable, we cannot exclude the possibility that due to the state of emergency the Government of Serbia or other authorities may take views which will that deviate from our current findings.