Business Law

Mid-term exam

Azra Hasani
 APPLIED BUSINESS LAW - COMPANY LAW
Business law - designates the academic discipline (Poslovno pravo - oznaava akademsku disciplinu)
Company law - more suitable for this discipline and content (vie prikladan za ovu disciplinu i sadraj)
Applied Business Law & Business law includes:
Company law (zakon o kompanijama)
Law on obligation (obligaciono pravo)
Labor law (radniko pravo)
Contractual law (zakon o ugovorima)
Securities (vrijednosnice)

Business Law is a broader discipline and includes various matters such as different business contracts,
especially: contracts of sale, securities & law on competition.

Leglal Systems are set of the general legal norms based on their content of social relations they regulate, into
a number of smaller or larger linked as whole. (Pravni sistem je skup opih pravnih normi distribuiranih na
osnovu njihovog sadraja (drutvenih odnosa koje reguliraju), u nekoliko manjih ili veih povezanih u cjelinu.)

Three major legal systems/legal circles in the world:

European Law or Continental Law (Europsko pravo ili Kontinentalno pravo)
Common Law or Anglo-Saxon Law (Zajedniko pravo ili Anglo-Saksonsko pravo)
Islamic Law or Traditional Law (Islamsko pravo ili Tradicionalno pravo)

Continental Law (European Law) is the oldest in human history. May also be referred to: Roman Law,
Roman-Germanic Law, Germanic Law or Continental Civil Law - based on a code, or "a systematic
collection of interrelated articles written in a terse staccato style. (Temelji se na kodu, ili "sistemskom
prikupljanju meusobno povezanih lanaka zapisanih u ovom stilu)

Common Law or Anglo-Saxon Law (Zajedniko pravo ili Anglo-Saksonsko pravo) refers to Law and
corresponding legal system developed through decision of courts and similar tribunals called Case law,
rather than through legislative statues.

PRECEDENT - is an official action or decision that has happened in the past and that is seen as an
example or a rule to be followed in a similar situation later. (Presedan - je slubena radnja ili odluka koje se
dogodila u prolosti te je viena kao primjer ili pravilo koje treba slijediti u slinoj situaciji kasnije.)
If a similar dispute has been resolved in the past, the court is bound to follow the reasoning used in prior
decision. When there is no legal statement of law from the past, judges have the authority and duty to
make law by creating Precedent. Body of precedent is called "Common Law" and binds future decisions.
When parties disagree on "what the law is" court will look to past precedential decisions.

Islamic Law (Shariah or Traditional Law) (Islamsko pravo ili Tradicionalno pravo)
Sharia is body of Islamic religious law. Legal framework that regulates public and political aspects of life for
those living in legal systems based on Islamic principles of jurisprudence and for Muslims living outside the
domain. Islamic Law deals with: politics, economics, banking, business, contracts, family, sexuality, hygiene,
social issues. Sharia is more of system of Law based on Quran.

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 LEGAL SYSTEM OF BOSNIA AND HERZEGOVINA
Legal system of Bosnia and Herzegovina has been determined by the specific stated in our constitutional
order and/or constitutional solutions that resulted from the Dayton Peace Accord.
(Pravni system BiH je odreen prema specifinostima navedenim u naem ustavnom poretku i/ili ustavnim rijeenjem
koja su rezultat Dejtonskog mirovnog sporazuma.)

BiH is the result of the dissolution of the former SFRY-general framework is "The Agreement for Peace in
BiH. BiH has XI Annexes and number of International Conventions - Annexes IV & X are the constitution
in technical meaning of this term.
BiH consists of two Entities:
Federation of Bosnia and Herzegovina
The Republic of Srpska
and Brko District as a special part of BiH territory.

Federation of Bosnia and Herzegovina: consist of 10 Cantons who have own constitution.
The Republic of Srpska has Municipalities (opine) within the RS.
Brko District has own constitution established by OHR - under direct authority of central government of
BiH.

First and highest legal base is presented by the constitution of BiH 1995. as a part of Dayton Peace Accord
(Prvi i najvei "Pravni temelj" za zajedniko zakonodavstvo - Ustav BiH/u sklopu Dejtonsog mirovnog sporazuma.)
Second legal base is joint legal regulations at the level of BiH as state (Drugi pravni temelj su zejedniki
zakonodavni propisi na nivou drave BiH.).

BiH has three different legislation levels (zakonodavni nivo):

1. level of BiH -> Parlament
(Nivo drave BiH je Parlament koji je zakonsko tijelo)
2. level are Entities levels -> Assemblies
(Nivo entiteta - Skuptina je zakonodavno tijelo)
3. level of Cantons in Federation of BiH-> Assemblies
(Nivo kantona Federacije BiH - Skuptina je zakonodavno tijelo)

There are laws that are:

uniform with territory of BiH as a whole (na prostoru itave BiH)
the laws that exist on the territory of the Federation of BiH (na prostoru Federacije)
the laws that exist on the territory of the RS (na prostoru Republike Srpske)
the laws that exist on the Canton territory, but with Federation of BiH itself (na prostoru kantona u
Federaciji BiH)
the laws that exist on the territory of the Brko Distict (na prostoru Brko Distrikta)

Business Law subject has been regulated at level of the Entities level.
Law on Business Enterprises (zakon o preduzeima)
Law on Bankruptcy Proceeding (zakon o steajnom postupku)
Law on Trade (zakon o trgovini)
Law on Obligation (zakon o obavezama)

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 EUROPEAN UNION LAW
European Union
The European Union (EU) is an economic and political union of 27 member states, located primarily in Europe
committed to regional integration.
Established formally by the Treaty of Maastricht on 1 November 1993. with almost 500 million citizens.
EU is not a federal state, not confederacy, not unitary state; this is specific union: custom union, political
union, economic union without borders, internal market, law union, sometimes classified as supranational law
making it one of the most encompassing modern legal systems in the world.

European Law
Law of the European Union is the unique legal system which operates alongside the laws of Member States
of the EU.
EU law has direct effect within the legal systems of its Member States, and overrides national law in many
areas, especially in areas covered by the Single Market.
European Law is prerequisite for common activities of country members end sustain of common pillars and
foredooms.
One of the features of the EU legal system is the multiplicity of legislative procedures used to enact
legislation.
The treaties micro-manage the EU powers, indicating different ways of adopting legislation for different
policy areas and for different areas within the same policy areas.

Characteristics of EU:
Supranational and economic-political community -27 member states "United in Diversify'
500 million citizens
Special position on non-members of EU
Single market
23 official languages
Common Official Gazette
Customs union
Monetary union
Schengen Union

History
May 9th 1950. Robert Schuman Declaration proposed the establishment of a European Coal and Steel
Community (E5CS). Treaty of Paris in March signed by Germany, Italy, France, Belgium, Luxembourg and the
Netherlands - The Big Six. The aim was establishment of common market in coal and steel between The Big
Six.
March 25th 1957. Treaty of Rome-Economic European Community (EEC)
Wider common market covering a whole range of goods and services and customs duties abolished on July
1st 1968.
Treaty of Maastricht - Treaty of European Union in December 1991. created the European Union and
common market.
October 29th 2004 The Treaty establishing a Constitution for Europe commonly referred to as the European
Constitution. An international treaty intended to create a constitution for the European Union.
It would have replaced the existing Treaties of the European Union with a single text if ratified by ail
member states. 2005. Referendum in The Netherland and France. December 12th 2007. Treaty of Lisabon - so
called Reform Treaty.June 13th 2008. referendum in Ireland.

1973 Denmark, United Kingdom and Ireland.

1981 Greece.
1986 Spain and Portugal.
1995 Austria, Finland, Sweden.
2004 the Czech Republic, Hungary, Poland, Slovakia, Estonia, Latvia, Lithuania,Slovenia, Cyprus and
Malta.
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2007 Bulgaria and Romania.
Three Pillars of the European Union
Like the EU itself, EU law can be divided into three pillars.
1. The European Community pillar: comprises the majority of law produced by the EU and is where the
European Court of Justice has the most power.
2. Relating to foreign policy and
3. Criminal law respectively; although the powers of the Court of Justice are much reduced and direct effect
does not apply.

I European Community (EG= EEC+EUROATOM+ECSC).

II Common Foreign and Security Policy.
III Police and Judicial Co-operation in Criminal Matters (PJCC)

Principles of the Single Market

Four freedoms are:

Free movement of goods (prohibition of custom duties, financial or any barriers having an
equivalent effect).
Free movement of person.
Free movement of capital.
Free movement of services.

The Union Institutions

The EU Parliament (EU parlament)
The Council of EU (vijee EU)
The EU Commission (EU komisija)
The Court of Justice (Sud pravde)
The European Court of Human Rights (Europski sud za ljudska prava)
The Court of First Instance (Prvostepeni sud)
The Auditing Court (Sud za reviziju)

The European Parliament

Election body that represents the EU's citizens and inhabitants. It exercises political supervision over the EU
activities and takes part in the legislative process. Members are directly elected every five years. Not fixed
seat-plenary sessions in Strasbourg, additional sessions in Brussels, the General Secretariat is based in
Strasbourg and Brussels.

The European Council

Composed by representatives at ministrial level. Meets four times a year. Chaired by a president or prime
ministar of a country holding the presidency of the Council of the European Union at the time. Political body
which reflects the national interests of members states in legislative matters Council of Europe.

The European Commission

Express the Community interest and promote further integration-clear supranational features. -Composed of
one commissioner from each member states. It has 46 directorates-general mainly based in Brussels and
Luxembourg.

The European Commission has three functions:

Initiates Community legislation

Acts as the guardian of the Treaties
Executive body of the Community

The European Court of Justice

Located in Luxembourg. Made up of one judge of each EU country assisted by eight advocates-generals. Its
role is to ensure that EU law complied with, and that the treaties are correctly interpreted and applied.
This Court played a crucial part in the process of integration in EU, particularly by interpreting the treaty basis
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of the Community, formally a species of international law, as internal law common to the member state
Court of First Instance
The judicial branch of the EU consists of the European Court of Justice and the Court of First Instance.
Together they interpret and apply the treaties and the law of the EU.
The Court of First Instance mainly deals with cases taken by individuals and companies directly
before the EU courts, and the ECJ primarily deals with cases taken by member states.

The European Court of Human Rights

The European Court of Human Rights in Strasbourg is an international judicial body established
under the European Convention on Human Rights of 1950 to monitor respect of human rights by
states.
The European Convention on Human Rights is a convention adopted by the Council of Europe. All 47
member states of the Council of Europe are parties to the Convention.
Applications against Contracting Parties for human rights violations can be brought before the Court
by other states, other parties or individuals.

Community Law - Acquis Communautaire

European laws are passed by the EU institutions through a number of procedures.
The European Commission has a monopoly on legislative initiative.
In such situation the Commission sends draft legislation to the Council of the EU and European
Parliament for amendments and approval.
The former body is composed of national government ministers and the latter by directly elected
politicians

The sources of EU law are:

Primary legislation
Secondary legislation - "Acts" brought by the Council and The Commission

The primary legislation are:

The treaties creating the institutions-constitutive treaties - ECSC Treaty 1951, EEC Treaty 19S7, Single
European Act 1986, Treaty of European Union 1992 (Maastricht Treaty), Treaty of Amsterdam 1997. -
Subsidiary treaties-conventions.

Secondary legislation "Acts" brought by the Council and The Commission are:
Regulations, Directives, Recommendations, Opinions, Decisions, General principles of law.

Regulations
A regulations set out general rules which apply uniformly throughout the EU and binding and are
directly applicable in national legal systems.
Directive
A directive may be addressed to some or all the member states and it is binding as to result to
be achieved. A member state has a discretion as to the means of implementation and in general
is not directly applicable. It requires implementation to be legally effective and these are
instrument of harmonisation of laws.

Decisions
A decision of the Council or Commission is an individual act addressed to specified persons,
either states or individuals. It is legally binding and it requires no further implementation.
Decision of the EG are binding and it is a role of the European Court of Justice in developing the
EU legal system. Recommendations and Opinions:
They are not legally binding, although persuasive.
They are not devoid of legal significance.
EU members countries have a duty to respect "messages" of recommendations and opinions.
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 FUNDAMENTAL CONCEPTS ABOUT STATE AND LAW

STATE
The state is association of families and villages for the sake of attaining a perfect and self-sufficient -
Aristotle
A state is an association of families and their common affairs, governed by supreme power and by reason-
Bodin
The state is an association which, acting trough law as promulgated by a government endowed to this end with
co erective power, maintains within a community territorially demarcated the universal external conditions of
social order - Maclaver
State is a territorial society, divided into government and subjects, whether individuals or associations of
individuals, whose relationship are determinate by exercise of this supreme co erective power - Laski

Main elements of the state:

Territory/fixed borders
Population/citizens/individuals
Sovereignty/political power, independency, equality with other state
International recognition/new states, new government

People or population is the human element of state. No people no state.

Definite territory (odreena/definisana teritorija sa granicama): territorial sovereignty or the superiority

of the state over all within its boundaries - complete freedom from external control (bez utjecaja drugih
drava) territory has to be definite because it ensures the exercise of political authority.

nomadic people (have some form of political organization), do not have a definite territory, so
(not constitute a state).
territory is large, or small but defined
a large area with natural resource makes a state powerful.
large size of a state (strategic and military advantages).
territory of a state includes land, water and sky over it and natural resources,
limit in the sea is an issue of controversy in International law.

Government
The government is a political and legal arrangement in the society. Without government
state would be a crowd of people and not state. The state expresses itself trough the
government. State is abstract while the government is state's concrete shape. Collective
life is impossible without a government (condition for any civilized life). The major
function of the government is to maintain peace lawfully.

The government acts trough three main organs:

Legislature (zakonodavna)
Executive (izvrna)
Judiciary (pravosudna)

SOVEREIGNITY

It is attribute of state which distinguishes state as one association from other association. (To je atribut
drave koji je izdvaja kao jedno drutvo iz drugih drutava)

Main figures of the state:

All four elements of state are indispensable to its existence
The state posesess a geographically identifiable territory with a body of citizens
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It has to have authority over all citizens and groups within its boundaries
 Territorial organization

A unitary state is sometimes one with only a single, centralised, national tier of government.
(Unitarna drava je ponekad sa samo jednom, centralizirani, nacionalni rang vlasti)

Federation is a union comprising a number of partially self-governing states or regions united by a

central "federal" government. The self-governing status of the component states is typically
constitutionally entrenched and may not be altered by a unilateral decision of the central government.
Confederation is permanent union of sovereign states for common action in relation to other states.

The difference between a confederation and a federation is that the membership of the member
states in o confederation is voluntary, while the membership in a federation is not.

LAW

A rule of conduct or procedure established by custom, moral or authority or agreement. A code of principles
based on morality, conscience, or nature. The body of rules and principles governing the affairs of a
community and enforced by a political authority; a legal system. A set of rules or principles dealing with a
specific area of a legal system: tax law; criminal law, constitutional law, civil law, business law, family law etc.

LEGAL FORMS OF COMPANY LAW: SOURCES OF LAW

First and highest legal base for legislation in BiH is presented by the Constitution of BiH.
Second base is joint legal regulations at the level of BiH.
Third level is entities level and this level is very important for the Subject Business Law.

Following issues have been defined by BiH Constitution Act: paying of international commitments of B&H;
emigration, refugees, asylum, carrying out of international and inter-entities polices, joint and international
communications establishing and functioning, regulating of inter-entities transport and the air transport
controlling, public procurements, intelectual ownership (copyright and industrial property rights), free zones,
foreign direct investments, e-legislation, e-business, e-signature, e-government, protection of consumers.
(Vanjska politika, vanjska-trgovinska politika, carinska politika, monetarna politika, WAT, finansiranje institucija i
plaanje meunarodnih obaveza BiH, emigracija, izbjeglice, azili, obavljanje meunarodne i meu-entititetske politike,
uspostava i funkcioniranje zajednikih i meunarodnih komunikacija, reguliranje prometa izmeu entiteta te promet i
kontrolu zranog prometa, javne nabavke, intelektualno vlasnitvo (autorska prava i prava industrijskog vlasnitva),
slobodne zone, izravna strana ulaganja, e-zakonodavstvo, e-poslovanje, e-potpis, e-Vladine organizacije, zatita
potroaa.)

State Bosnia and Herzegovina, amoung which the most important sources are:

Law on Competition (2001), Zakon o konkurenciji

Law on Concessions (2002), Zakon o koncesijama
Law on Free Zones (2002), Zakon o slobodnim zonama
Law on Industrial Property right in BiH (2002), Zakon o pravu industrijskog vlasnitva u BiH
Law on Copyright in BiH (2002), Zakon o autorskom pravu u BiH
Law on Public Procurements in BiH (2004), Zakon o javnim nabavkama u BiH
Law on Protection of Consumers in BiH (2005), Zakon o zatiti potroaa u BiH
Law on WAT (2006), Zakon o WAT
Law on e-commerce (2008), Zakon o e-poslovanju
Law on e-signature (2007), Zakon o e-potpisu

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Law sources in the Federation of BiH are:

Law on Business Enterprises (1999, 2003 & 2008), Zakon o privrednim preduzeima
Law on Foreign Investments (2001) & registration rules, Zakon o stranim ulaganjima, pravila registracije
Law on Securities (2008), Zakon o vrijednosnim papirima
\
Law on Securities Commission (1998), Zakon o komisiji za vrijednosne papire
Law on Securities Register (1998), Zakon o registru vrijednosnih papira
Law on Bankruptcy Procedure (2003), Zakon o steajnom postupku
Law on Liquidation Procedure (2003), Zakon o postupku likvidacije
Law on Concessions (2002), Zakon o koncesijama
Law and other regulations on legal entities registration in register (2000), Zakoni i drugi propisi o registraciji
pravne osobe u registar
Law on Banking, Zakon o bankama
Law on Insurance Company, Zakon o osiguravajuim drutvima
Law on Micro Credits Organizations, Zakon o Mikrokreditnim organizacijama
Law on Private Investment Funds, Zakon o privatnim investicijskim fondovima
Law on Public Enterprises, Zakon o javnim preduzeima

Elements of legal form:

defines relations in society so that changes in these relations set up boundaries.(Definira odnose u
drutvu, tako da promjene u tim odnosima postavljaju granice.)
is a social norm too that regulate relations in society where is possibility of misunderstanding and
conflict
is written and regularly includes sanctions
is consisting of two main parts: disposition and sanction
some legal norms have two more elements: hypothesis of disposition and hypothesis of sanction

There is a formula of a legal form: LN=(HD)+D+(HS)+S

Hypothesis of disposition - is part of the norm that defines the factual situation, or facts that must exist in
order for disposition, the main part of the norm to be applicable (je dio norme koji definira injenino stanje, ili
injenice koje moraju postojati za dispoziciju).

Disposition - is defined rule of conduct (part of legal norm) and the obligation to perform a given action
can consist of acting - facere, or non-acting - non facere. (definirana pravila ponaanja (dio pravne norme) i
obveze za izvoenje date akcije moe se sastojati od djelovanja ili ne-djelovanja)

Hypothesis of sanction - consist of the description of the violation of disputation or offence. It's the
description of action that represents violations of disposition, (to je opis akcije koja predstavlja krenje
dispozicije.)

Sanction - is part of legal norm that contain a rule of conduct by the subject who has violated the
disposition, and by a state organ authorized to exercise an appropriate measure toward the violator, (je dio
pravne norme koje sadri pravilo ponaanja koje subjekt koji je prekrio dispoziciju, a dravni organi su ovlateni da
koriste odgovarajue mjere prema prekritelju)

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Legal norms by subject and scope of regulation (Pravne norme po predmetu i opsegu regulacije):

General legal norms - by number of case that regulate General norms - are those that pertain to
an indefinite number of subjects of an accurately defined kind of relationship (ope norme)
Individual legal norms - are those addressed precisely to the named as the subject of
particular relationship (individualne norme)
Substantive law norms: are the norms that regulate relations among people, subject of law.
Procedural law norms - regulate conduct of the subjects that ought to execute the legal
norm, primarily state authorities (court).

Legal norms by the degree of disposition specification (pravne norme po stepenu dispozicije)

Cogent (strict) legal norm- norm where the subject is bound to behave strictly in accordance with
the norm, and always under the threat of sanction (this norms is also called absolutely specific and
categorical legal norms)

Alternative norms - a subject has freedom to choose one of the few conducts provided for the
disposition

Dispositive norms - are those that leave subject full freedom to regulate mutual relations as long as
this freedom in within the legal order framework (these forms are also called
alternating/replaceable legal norms)

Discretionary legal norms - leave the subject to execute the norms (state authorities) the freedom to
act in the way they deem the best in an actual case. These are the norms that give discretionary
authority to a state organ

Flexible legal norms - are issued for situations where it is not possible to categorically set a rule of
conduct, due to a series of various actual circumstances

Elements of the system of law are: legal norm, legal institution, branch of law and field of law (pravna
norma, pravni institucija, "grana" prava i pravno polje).
Legal norm is fundamental element of system of law.
Legal institution is harmonized and organized set of legal rules that encompass and regulate a single social
relationship (marriage, ownership, family-law)
Field of law is created by grouping of related branches of law (6 major fields of law): substantive and
procedural, public and private, national and international law (materijalno i proceduralno, javno i privatno,
nacionalno i meunarodno pravo)

General Legal documents

regulate social relation in coherent way
include general legal norms
include: constitution, act, by laws, general documents of social organizations, customary law and
court decision with capacity of precedent

Constitution - is the highest legal document in a state and the highest fundamental law in a state.
is legal and political document -written and unwritten
written constitution implies a set of norms in writing that regulate state organization
unwritten constitution is system of constitutional customs that exist in a given country that regulate
basic issues of state organization (UK, Saudi Arabia, Israel)

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 Act - is a general legal document of highest legal force following the constitution
Bylaws - are general legal documents typically passed by political-executive and administrative
bodies
General documents of non-state organizations - include rules of various social organizations based
on which they are constituted as organizations and legal persons (statutes, rulebooks of
employment..)
Custom - becomes a source of law due to long-lasting identical conduct (objective element) if
there exists a legal conviction of mandatory nature (subjective element)
Court ruling - is an individual legal document, which means that it contains an individual legal
norm pertaining the actual case. Court rulings with capacity of precedent are also general legal
documents.

Individual legal documents: mostly imply the concretization of a general document; incomplete individual
legal document - if contains only the disposition or only sanction -complete individual legal document - if
contains both.

Subject and object of law

Legal subjects
include people and social formations that have legal obligations and legal authorities with respect of
legal object
is primarily a human individual (not always)
human individual is natural person
social formations reorganized a legal subjectivity by legal system are legal persons
child acquires legal capacity as soon as it is born

Natural person (subject of law)

each person become subject of law at birth
all natural persons are equal in their rights
must poses attributes: name, abode and residence, citizenship, ID...

For legal capacity (natural person) is necessary:

to be born alive
should have a human shape

Business capacity:
persons with 15 years have working capacity
full capacity is gained with 18 years (LS B&H) or if minor marries before, 21 year (Anglo-American)

There is three degree of business capacity: full business capacity, limited business capacity and business
incapacity.

Full business capacity - is capacity of majors, or married minors

Limited business capacity - can make legal deals (with approval of parents)
Business incapacity - cannot make legal deals (legal representatives make deals on their behalf)

Offence capacity: to be liable for his illegal actions at age of 7. Minors with 14 years have full offence
capacity

Legal persons (subject of law):

is a social formation with a legal capacity recognized by legal system
is created by establishment, and ceases with deletion from proper registry where his status data
are kept

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 FUNDAMENTALS OF LAW AND OBLIGATIONS
Obligation may imply relationship between at least two persons - one persons is authorized to require, other
to do or not to do something.

In object sense law of obligations is a set of legal norms regulating obligation relations. (U objektivnom smislu
obligaciono pravo je skup pravnih normi kojima se reguliraju obligacioni odnosi.)

In the subject sense, law of obligation is given person's authorization or right to require given conduct
from another person debtor. (U subjektivnom smislu, obligaciono pravo daje osobi (kreditoru) odobrenje ili pravo
da zahtijevaju "dato" od druge osobe)

Obligation action - is the conduct by participants in the obligation relationship required for the obligation
to be fulfilled.
(Obligaciona akcija - je ponaanje od strane sudionika u vezi obveza koje potrebno ispuniti.)

Obligation action can consist of:

Giving (dare)
Acting (facere)
Non-acting (non-facere)

Types of obligations:
Obligations by kinds of action (Obveze po vrstama djelovanja)
Obligations according to the way of determining the obligation action (Obveze prema nainu
utvrivanja obligacionih akcija)

Obligations by kinds of action (Obveze po vrstama djelovanja)

strictly personal: if it is only the debtor and no one else that is bound to perform the action
non-personal: the action can be performed by someone else for the debtor
momentary: given obligation can be performed in short time period
permanent: if last longer
divisible: obligation can be fulfilled in two or more parts
indivisible: obligations that need to be fully fulfilled since division will decrease it value
simple: obligation can be fulfilled by one single action
complex: consist of few actions
pecuniary: debtor is bound to give creditor money, a thing or to do or not to do something
non-pecuniary: debtor is bound to not give creditor money

Obligations according to the way of determining the obligation action (Obveze prema
nainu utvrivanja obligacionih akcija)
special or individual: is the one when the action the debtor is bound to take is known
generic (opposed to individual ones): object of obligation is not clearly determined
alternative: when obligation include two or more actions debtor is bound to take only
one
facultative: object of obligation is clearly determined; action debtor can be authorized to
fulfill the obligation by taking another, also clearly determined action
natural: obligations non legally protected

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Subject of obligation law relations (subjekt obligacionih odnosa)
subject in obligation relationship can include legal and natural person
one subject is holder of right (creditor), another is holder of obligations (debtor)

Plurality of subject obligations: an obligation involves few creditors and few debtors.
Common Obligation: \ When obligations is divisible creditor is authorized to require only its part of the
calm, and each debtor owes only its part of a debt. (Kada se obaveza moe podijeliti - kreditor je ovlaten da
trai samo svoj dio, te svaki dunik vraa svoj dio)
Solidary Obligations: In case of plurality of subjects in a single obligation co-debtors are bound to perform
an entire action, while all the co-creditors are authorized to require the entire action. (U sluaju pluraliteta
subjekata u jedno obavezi - sudunici su duni obaviti cijelu "akciju", dok su svi do-kreditori ovlateni da zahtijevaju
cijele "akcije)

Change of subject in the obligation - in a case of strictly personal relations

cession of calm - if an obligation experience a change on the creditor's side
taking over a debt (assumption) - if the subject is changed on the passive, debtor's side

Cession is transaction where the previous creditor transfer his claim to his co-contractor, a new
creditor, while both the debtor and debt remain the same. (transakcija gdje prethodni kreditor prenosi svoju
"tvrdnju" njegovom do-kreditoru tj. novom kreditoru, a dunik i dug ostaju isti)

Assumption of debt is name for a transaction where a debt can be taken over in full, so that the debtor is
fully exempt from the obligations. (naziv za transakciju, gdje se dug moe preuzeti u cijelosti, tako da je dunik u
potpunosti osloboen obveze)

Sources of obligations are legal facts and conditions that form the basis of obligations are sources of
obligations. (Pravne injenice i uvjeti - izvori obligacionog prava)

1. Contract is the most frequent source of obligation including legal transaction in general.
2. Unilateral civil-law transactions are those where in the obligation as a bilateral legal relation arises by
expression of will by one person (for ex. beauty contest, the selection of the best architectural design..)
3. Causing damage or civil offence is a source of obligation in the way that person caused the damage to
another person through an unlawful action bound to indemnify the latter for damage, unless he proves that
the damage occurred with no fault of his.
a) Fault liability is liability based on subject liability. The point is that perpetrator of harmful
action was aware or had to be aware that he would cause damage to second person by such
action (intention).

b) Strict liability is object liability. In this form of liability the culpability of the perpetrator causing
the damage is not essential element, and one is liable for the damage by the very fact of damage
occurrence (cars, gas, petrol or construction site...)

Damage is decrease in social resources, or someone's property, and prevention of their increase as well as
causing physical or psychological pain or fear to another person.
Unjust enrichment or acquisition without foundations as a source of obligation creates the obligation to
return what was received without foundations. (Nepravedno bogaenje i stjecanje bez osnove)
"Management of anothers affair" (management without mandate) is someone who takes action in good
faith in another person's interest, and without the letter's authorization.

12 I P a g e
Cassation of obligation (prestanak obaveza):

1) Fulfillment - implies the proper performance of the action that was the object of the debtor's
obligation (ispunjenje)
2) Impossibility - result in the impossibility to fulfill the obligations and the debtor cannot be blamed
for it. (nemogunost)
3) Compensation - both have debt to each other. The balance shell paid by party whose debt is higher.
(kompenzacija/naknada)
4) Novation - an agreement between the obligation subjects aimed at replacing the existing obligation
with a new one.
5) Confusion - if an obligation, the creditor and debtor consolidate into a single person. (zbunjenost)
6) Waiver of debt - the agreement between the creditor and debtor on waiver of debtor's obligation.
(odricanje od duga)
7) Lapse of time - leads to cassation of the permanent obligation. (odmicanje vremena)
8) Cancellation - is one of the ways of cessation of permanent obligation relation, based on a unilateral
expression of will by one obligation subject. (otkazivanje)
9) Death - of one obligation subject does not result in the cassation of obligation, rights and obligations
pass on successors.

Effect of time on legal relations

Time can affect in two ways: destructively and constructively.

Limitation is the loss of claim due to non-fulfillment of content of subjective right through a time period
defined by law. Time period for limitations are provided by law, and subjects cannot shorten or prolong it.
Some circumstances lead to the end of limitation

Participation is concept opposite to limitation. When the legal determined time has expired, a given factual
relations turns into a legal (legally protected relation).

Preclusion (or preclusive time period) is time within a right has to be exercised in order to be preserved.

13 ] P a g e
 LABOUR LAW

Sources of Labour law

Are all general documents or a legal character that appear as sources of other branches of law as well
They cant be determined for all times and for all legal systems but can be classified by the following
groups:
state regulations
collective agreements
general employer's documents - sources of autonomous law
international sources of labour law
customary law
court practice

Employer is natural or legal person that provides a job to the employee based on employment contract.
(Poslodavac je fizika ili pravna osoba koja nudi posao da zaposleniku na temelju ugovora o radu)

Employee is a natural person whose employment is based on employment contract. (Zaposlenik je fizika
osoba iji je radni odnos na temelju ugovora o radu)

Employment is formation of an employment contract between an employer and employee (Zapoljavanje je

formiranje ugovora o radu izmeu poslodavca i zaposlenika)

The essential elements of employment are: voluntariness; personal, labour law and functional bond;
inclusion in the work process; and the exercise of rights and obligations in the workplace. (dobrovoljnosti;
osobne, obaveze prema pravu radnika i funkcionalne obaveze; ukljuivanje u proces rada, te ostvarivanje prava i obveza
na radnom mjestu)

Voluntariness: the principle of voluntariness implies the right to the choice of occupation, and both subjects
freely decide upon whether and which subject will form an employment relation

Personal, labour-law and functional bond

employment is a specifically personal relation
employee has obligations to perform the jobs and tasks with his position (from start, till end)
cannot transfer his obligations to another person

Inclusion in the work process should be done in the way and under the conditions determined in the
document of employment.

Exercise of rights and obligations in the workplace:

employment; related rights and obligations determine the position of the parties in the employment:
employer and employee
employer's basic right is to determine the place, conditions and way of performing the work,
complying with regulations and employee's rights
no discrimination duo to race, sex, language...
collective agreement; rules of employment or employment contract

Employment contract can be formed for an indefinite and definite time period, can be in written or oral form.
Cant be formed with:
person younger than 15 years of age
person between 15 and 18 (with permission of parents, and with certificate from an authorized
physician or relevant healthcare institution)

Employer is bound to render the employee capable of work in the way that ensures the protection of the
employee's life and health, and prevents the occurrence the accidents.
An employment contract ceases:
1) Employee's death
2) By agreement between the employer and employee
3) Employee reaches 65 years of age and 20 years of employment insurance
4) By valid decision of the less of working capability
5) By employer's or employee's notice
6) Expiration of defined time (by contract)
7) Employee received a prison sentence (more than 3 months)
8) Employee becomes the subject of a security measure
9) By decision of relevant court (of cassation)

15 | P a g e
 COMPANY LAW
Company law is an independent legal discipline which studies the legal regime of companies, both the general
legal regime and the legal regime of each individual company.(Poslovno pravo je samostalna pravna disciplina koja
prouava pravni reim kompanija, tj. opi pravni reim (generalno pravni reim) kao i pravni reim svake pojedine
kompanije.)

This separate legal discipline is distinguished from the business law, due to the complexity of subject matter
being studied, independent sources of law, as well as an increasing degree of specialization and the need for
a separate study of individual legal institutions. (Ova odvojena pravna disciplina se razlikuje od poslovnog prava,
zbog sloenosti predmeta kojeg prouava, nezavisnih izvora prava, kao i veeg stepen specijalizacije i potrebe za
odvojenim prouavanjem pojedinih pravnih ustanova.)

Companies are classified into:

Corporation: joint-stock company; limited-liability company

Partnerships: unlimited solidarity liability company or general partnership; limited partnership (which
can be an "ordinary" limited partnership and limited stock partnership, if its subscribed capital is
distributed to shares.

Companies in the European Union law

Within the European Union community law the following profitable forms of business organization can be
recognized:
European economic interest group-EEIG (Europska ekonomska interesna grupa)
European company or European enterprise (Societies European) (Europske kompanije ili Europska
poduzea)
Non-profitable forms of organization include:
European cooperative society
European insurance company
European association
Directives of the EU Committee oblige member countries to adopt them in their legal system
unreservedly.(Direktive EU obavezuju odbore zemalja lanica da ih usvoje u svoj pravni sistem potpuno)

The harmonized European supranational law excludes the implementation the national law which is
opposed to this community law. (Europsko pravo iskljuuje primjenu nacionalnog prava koje je u suprotnosti s
ovim zakonom zajednice.

The directives regulate following:

protection of shareholders' and third parties interest (zatita dioniara i interesa treih osoba)
formation and elements of a joint-stock company statute (formiranje i elementi statuta dionikog
drutva)
changes in subscribed capital and merging shares (promjena upisanog kapitala i spajanja dionica)
content and publishing of business reports (sadraj i objavljivanje izvjetaja o poslovanju)
liability of joint-stock company organs (obaveza organa dionikog drutva)
status change of joint-stock company merger (promjena statusa spojenog dionikog drutva)
preparation of consolidated balance sheets (sastavljanje konsolidiranih bilanci)
auditor appointment (imenovanje revizora)
mandatory data that have to be published by branches (obvezni podaci koji moraju biti objavljeni po
ograncima)
issues pertaining to operations and establishment of single-member companies (pitanja koja se
odnose na osnivanje i poslovanje pojedinih kompanija - lanica)
Other occurrences of the European company would be:
formation of a holding company in the form of limited - liability company (formiranje holdinga u
obliku drutva ograniene odgovornosti)
creation of a joint subsidiary by the already existing limited - liability companies (stvaranje zajednike
podrunice za ve postojea drutva ograniene odgovornosti)
conversion of the existing companies into a European Company (pretvaranje postojeih poduzea u
europske tvrtke)
giving permissions to the existing European Companies' subsidiaries to establish new
subsidiaries (davanje dozvole postojeoj "ker Evropskoj kompaniji" za uspostavu nove podrunice)

European economic interest group (EEIG) is a form of interest-based association aimed at the
mutual association of the already existing companies.

Founders are natural and legal persons governed by both private and public law.
legal persons (as founders)registered office on the territory of a EU member country
natural persons (as founders)involved in a form of industrial, craft, commercial or agricultural activity
Memorandum of association is a contract (Memorandum udruenja je ugovor)
Registration confers full business capacity on the grouping throughout the European Union
(Registracijom se stie puna poslovna sposobnost na grupirsanje irom Europske unije)

Rule on EEIG of 1989 doesnt determine minimum capital (ne odreuje iznos minimalnog kapitala). Goal of
grouping is not profit making but only the members' cooperation within the agreed fields of their common
economic activities.

Lex Specialis organisations are:

commercial banks (komercijalne banke)
micro-credit organizations (mikro-kreditne organizacije)
insurance companies (drutva za osiguranje)
investment funds (investicijski fondovi)
stock exchanges (berza)
public enterprises (javna poduzea)

Branch of business society

Business society can have branches outside its seat. They don't have the capacity of legal person but that can
perform all the activities within the society activity entered in register and thus acquire rights and obligations
in the name and on behalf of the business society. (Poslovne jedinice koje nemaju kapacitet za pravne osobe, ali da
mogu obavljati sve djelatnosti u okviru djelatnosti drutva upisana u registar i na taj nain stjecati prava i obveze u ime i
na ime poslovanja drutva).

Branches are registered with the registration court where the business society itself in registered with the
company register. (Poslovne jedinice su registrirane kod suda gdje je registrovano poslovanje samog drutva u
registrirano). This part doesn't have the capacity of legal person (ovaj dio poduzea nema kapacitete pravnog lica).

Depending on the type of activity, following names can be found:

branch for commercial banks (granu za komercijalne banke)
plant (postrojenja)
business unit (poslovne jedinice)
business object number (broj poslovnog objekta)
department (odjel)
outlet
Branch name can also be determined by a separate legal document. (Naziv poslovnice moe se odrediti posebnim
pravnim dokumentima.) For example: Law on Banks, Law on Insurance Companies etc.
Parent company and subsidiary company (matine kompanije i podrunica kompanije)

ZOPD regulates issues of establishment and operations of controlled or dependent companies - subsidiaries
in a special way.(ZOPD ureuje pitanja osnivanja i poslovanja podrunice na poseban nain)
Subsidiary is defined as a company where another company has the majority of voting. (Podrunica je
definirana kao kompanija u kojoj druga kompaniji ima veinu dionica s pravom glasa.

English law recognizes:

concepts of a holding, or parent company, and subsidiary company
conditions are prescribed when a company is to be considered a subsidiary or a holding
company (Uvjeti su propisani kada se kompanija smatra podreenom kompanijom ili holding-om)
for the holding to be a shareholder in the subsidiary and to control the composition of its
management, for the holding to own over 50% of the subsidiary's equity,
when a subsidiary is in the same time a subsidiary of a company that is already of a third company's
subsidiary-the so-called sub-subsidiary or the subsidiary's subsidiary

French Act on Commercial Companies (Prema francuskom Zakonu o trgovakim drutvima)

Parent company exists when a company, directly or indirectly through other companies; holds part of
capital which suffices to allow it the majority of votes in the assembly, or when it has majority of votes in
the subsidiary's assembly based on a separate agreement signed with other members or shareholders.
(Nadreena tvrtka postoji kada poduzee, izravno ili neizravno preko drugih kompanija, dri dio kapitala kojim bi se
omoguilo dovoljna veina glasova u Skuptini, odnosno ako ima veinu glasova u podrunici u skuptina na temelju
posebnog ugovora potpisanog s ostalim lanovima ili dioniara.)

Holding is such a form of association among a few companies where the factual control over the controlled
companies is achieved by virtue of owning ordinary shares, as well as multiple-vote shares. (Holding je takav
oblik udruivanja izmeu nekoliko tvrtki u kojima se postie eljena kontrola nad poduzeem na temelju posjedovanja
redovnih dionica, kao i viestrukog glasanja dioniara.)

The U.S.A. law recognizes the legal construct of 'trust'

Trust is created by gaining control over other companies, by means of gaining control over subsidiaries'
shares. (Povjerenje se kreira kontrolom nad drugim kompanija, putem stjecanja kontrole nad dionicama podreene
kompanije)
Control can be achieved by buying shares or taking them over through status changes of mergers or
take over without establishing a new company. (Kontrola se moe postii kupnjom ili preuzimanjem dionica
putem statusnih promjena (spajanja ili preuzimanja) bez osnivanju nove kompanije.)

'consortium'(special form of contractual association of companies) which implies association aimed at

carrying out a given business venture. (Poseban oblik ugovornog udruivanja kompanija je "konzorcij", to
implicira udrugu s ciljem obavljanja datog poslovnog poduhvata.)
Association is achieved based on the contractual law, without forming a new legal subject. (Udruga se
ostvaruje na temelju ugovornog prava, bez formiranja novog pravnog subjekta.)

In the Continental law, consortium is organized in a different ways. In most cases, it is organized based on
contractual law norms and, as a rule, it is an unnamed contract of business law. (Veini sluajeva, 'consortium'je
organiziran na temelju ugovornog prava i norme, kao pravilo to je neimenovani ugovor u poslovnom pravu.

A joint venture is a kind of joint undertaking resulting from the U.S.A business practice. The U.S.A legal
system used to include a ban for companies to form partnerships. (Pravni sistem SAD se koristi izdavanjem
zabranama za kompanije u obliku partnerstva)
In order to evade this ban, a legal and business construct called joint venture was created, which is also
widespread in the continental legal regime. 18 I P a g e
Joint-Stock company organs (organi dionikog drutva):
General meeting (Generalni sastanak)
Supervisory board (Nadzorni odbor)
Management (board) (Menadment)
Secretary (Sekretar)
Audit board (Odbor za reviziju)

1. General meeting it consists of shareholders; chaired by Chairperson. The chair person and other members
of supervisory board, director, members of the management attend the general meeting. Is held at least once a
year; is asked & set up by supervisory board.

Request for General meeting can by submitted by:

shareholder or group with over 10% of the total number of voting share
a member of supervisory board
audit board
decisions on general meeting pass with more than 50% of voting shares.

The share-holders decide upon:

increase or decrease of equality
issue of new shares of the same class
issue of new shares of a new class
financial statement by auditor, supervisory board
distribution of profit and dividend payments
way of covering losses
merger with other enterprises..
split and cassation of joint-stock companies
changes in joint-stock company's form
purchase, sale, exchange sets ..no more than 1/3 of value of the company's assets
sale and purchase of assets (value 15% - 33%) of the bookkeeping company's assets
appointmant and release members of supervisory board
appointment/release of an external auditor/ auditor board
establishment, reorganization and liquidation of subsidiaries and their statues
payments for members of the supervisory board and audit board
amendments of the statue
exempting fixed assets in non-private companies
issues essential for operations- pursuant to the law and statute

2. Company's supervisory board (Nadzorni odbor)

Consist of chairpersons and no less than two members appointed at general meeting. Persons cannot be
the chairpersons neither members of supervisory board:
criminals convicted for doing not lawful economic activities in supervisory board
5 years from convicting
criminals that have courts prohibition for doing activities in supervisory board
persons over 65 years of age on the day of appointment
candidate for supervisory board
proposed by shareholder with no less than 5% of voting shares
director or employee cannot be member of a sup board

19 | P a g e
The supervisory board is responsible for:
overseeing company's operations
overseeing management's work
adopting business reports
submitting reports, schedule, plans for business year...
electing chairperson of the supervisory board
proposing distribution and ways of using/covering profit/loss
approving sale and purchase of assets (value 15% - 33%) of the bookkeeping company's assets
appointing chair-person of remuneration/appointment committee
establishing temporary commissions and defining tasks
converting general meeting
approving issues of new shares of existing class
The supervisory board chair person and members are liable for damage caused by failure to perform or
improper performance of their duties.

3. Company's management
Company's management is in charge of:
Organizing work and managing operations,
Representing the join-stock company
Is liable for the legality of operations

4. Company's secretary
Keeps the shareholders book, the registry of the minutes of shareholder's general meeting and
supervisory board's meetings. Keeps documents defined by the law and the company's statute, except
financial statements. In charge of preparing sessions and talking minutes of shareholder's general
meeting and the supervisory board.

5. Company's audit board

Chairpersons and members of audit cannot be members of any board! Cant employee or person with financial
interests in joint-stock company; only salary is from joint-stock company; bound to perform an audit of the
semiannual and annual statements and an audit financial report requested by shareholder with no less than
10% of voting share.
Submit the report on general meeting (no more than 8 days since audit completion); can cart for general
meeting (only if they think that shareholders are jeopardized, or when they detect irregularities in activities by
members of (supervisory board, management).
Companys liability
Corporate liability implies a few legal and economic aspects. The liability implies a few forms, both in
terms of the kind of company and in terms of individual stages of its existence. Liability is immanent
for the overall company operation, starting from its establishment to the cessation of existence. There
are a difference between company's liability and liability of its members, i.e. founders.(Korporativna
odgovornost podrazumijeva nekoliko pravnih i ekonomskih aspekta. Odgovornost podrazumijeva nekoliko oblika,
kako u pogledu vrste poduzea, tako i u pogledu pojedine faze svog postojanja. Odgovornost je kljuna za
cjelokupni rad kompanije, poevi od svog osnivanja. Postoje razlike izmeu odgovornost poduzea i odgovornost
njenih lanova, odnosno osnivaa.)

Corporations are subject to a different liability regime compared to partnerships, and in general
partnerships there is also a difference in liability between the two kinds of its members. There is also the
mentioned difference with respect to the company's liability in different stages of its existence. In order to
establish a company, the act of registration itself has to be preceded by taking a number of obligations
necessary for a company to be established in the first place. (Korporacije su predmet razliitih reima
odgovornosti u odnosu na partnerstva, i openito kod partnerstva tu je i razlika u odgovornosti izmeu dvije vrste
partnerstva. Tu takoer spominje razlika u odnosu na odgovornost poduzea u razliitim fazama svog postojanja.
Kako bi osnovali kompaniju, sam in registracije mora prethoditi uzimanjem brojnih obveza potrebnih za kompaniju
kako bi uopte bila osnovana.)

These can include obtaining loans, acquisition of required equipment, signing contracts, e.g. on leasing
business premises, future staff recruitment, etc. These activities necessarily lead to the need, in actual
cases and examples, for a person to be authorized as a legitimate representative of a company that is still
to be registered, i.e. founded. (To moe ukljuivati dobivanje kredita, nabavku potrebne opreme, potpisivanje
ugovora, npr. o najmu poslovnog prostora, budue zapoljavanje osoblja, itd. Ove aktivnosti je nuno dovesti do
"potrebe", u stvarnim sluajevima i primjerima, za osobe koji bi trebao biti ovlatena kao legitimni predstavnici
kompanije koja jo uvijek treba biti registrirana, odnosno osnovana.)

ZOPD does not attach the necessary significance to this issue at all. It only provides that a company
acquires legal personality on the day of its registration in the company register, and that no one can act on
behalf of the company before its registration. (ZOPD ne pridaje veliki znaaj za taj problem uope. On samo
navodi da kompanija stjee pravnu linost sa danom upisa u registar poduzea, te da nitko ne moe djelovati u ime
poduzea prije njegove registracije.)

Consequent to this solution, ZOPD specially provides that a person who acts contrary to this provision is
liable for the created obligations with his entire property, and if a few persons act together, they have
unlimited solidary liability for the obligations taken. (Dosljedan na ovo rjeenje, ZOPD posebno omoguava da
osoba koja djeluje u suprotnosti sa ovom odredbom jami sa svojom cjelokupnom imovinom, te ako nekoliko osoba
djeluje zajedno, oni su neogranieno solidarno odgovorni za preuzete obveze.)

In the section about the memorandum of association, ZOPD says that the memorandum of association
shall include a provision about the full names of the persons who represents a joint-stock company in the
procedure of its establishment. (U odjeljku o memorandumu udruivanja, ZOPD kae da memorandum
udruivanja e ukljuivati odredbu o punim imenima osoba koje predstavlja dioniko drutvo u postupku njegovog
osnivanja.)

By analogy, this provision can be applied to the establishment of a limited-liability company. When the
problem will arise if the company is not registered or if the obligations taken in this founding stage of the
company are not fulfilled, in this case, the problem would be solved by applying general rules of law of
obligations pertaining to fulfilling contractual obligations. (Po analogiji, ova odredba moe se primijeniti za
osnivanje drutva s ogranienom odgovornou. Kada e problem nastati ako kompanija nije registrirana ili ako je
obveze preuzete u fazi osnivanja kompanije nisu ispunjeni, u ovom sluaju, problem e biti rijeen primjenom opih
pravila prava o obvezama koje se odnose na ispunjenje ugovornih obveza.)

21 I P a g e
Natural persons shall always be liable for taken obligations with all their property. Since these are tasks
and obligations taken on behalf of a future legal person, it would suffice to include only the provision that
founders are jointly liable for the obligations taken. Comparative legal systems recognize a special legal
form called pre-company. (Fizike osobe, uvijek e biti odgovorna za obveze preuzeta sa svom njihovom imovinom.
Budui da su zadaci i obveze poduzete u ime budue pravne osobe, bilo bi dovoljno da sadre samo odredbbu kojom su
osnivai zajedno odgovorni za poduzete obveze. Komparativni pravni sistem prepoznatljiv kao posebni pravni oblik
nazvan pred-kompanija.)

There are numerous and different legal understandings of the type of legal construct this is. Thus, some
say that it is a civic partnership, pre-contract or company in the process of establishment, kind of legal
fiction or else a contract being signed in favor of a third party. They differ only in which legal instrument
defines the status of pre-company. As opposed to these, English law knows of the founder's fiduciary
obligation to the company that is only to be registered. (Postoje brojna i razliita pravna razumijevanja ovakve
vrste pravne konstrukcije. Ovako, neki kau da je to graansko partnerstvo, predugovor ili firme u procesu osnivanja,
vrsta pravnih fikcija li ugovor potpisan u korist tree osobe. Oni se razlikuju samo u tome koji pravni instrument
definira status pred- poduzea. Za razliku od njih, engleski zakon zna za osnivaevu obavezu za kompaniju koja samo
to nije registrovana.)

Founders of joint-stock companies and founders of limited-liability companies are liable up to the value of
their shares, i.e. stakes. This also applies to members that have subsequently joined the company. (Osnivai
dionikih drutava i osnivai kompanija sa ogranienom odgovornou su odgovorni do vrijednosti svojih dionica,
odnosno udjela. Ovo se takoer odnosi na lanove koji su se naknadno pridruili kompaniji.)

Liability applies to all types of obligations regardless of their origin and basis. Corporate liability should be
distinguished from the already described risk of a company founder. (Odgovornost se odnosi na sve vrste
obveza bez obzira na njihovo porijeklo i temelj. Korporativnu odgovornost treba razlikovati od ve opisanih rizika
osnivaa kompanije.)

Although company owners are liable only up to the value of their investment, their stake in the overall
book value of the company's assets will also be affected. (lako su vlasnici kompanija odgovorni samo do
vrijednosti svojih ulaganja, njihov udio u ukupnoj knjigovodstvenoj vrijednosti imovine poduzea takoer e biti
pogoen.)

Asset is a complex category and deserves a special attention. This statement applies to the entire
assets.
It includes both tangible assets and:
premises, equipments, furniture, computer gears...
goods in producing and warehouses
monetary resources
due unpaid receivables
notes receivable
shares in other companies,

Further, assets also include:

intellectual property rights
copyrights
industrial property rights

Finally, it also includes the so-called intangible assets or goodwill, which mostly expresses a company's
market position.

22 I P a g e
Partnerships are liable for their obligations with the entire company's property, and members of such
companies are also liable with their entire property, not invested in the company. This form of liability is
also called the unlimited solidary liability. In this form of liability, all the members of the unlimited
solidary liability company, i.e. partnership, are equal. (Partnerstva su odgovorna za svoje obveze cijelom
imovinom poduzea, te su lanovi takvih kompanija odgovorni i sa svojom cjelokupnom imovinom koja nije uloena u
poduzee. Ovaj oblik odgovornosti se takoer naziva neograniena solidarna odgovornost. U ovom obliku
odgovornosti, svi lanovi drutva neograniene solidarne odgovornosti, odnosno partnerstva su jednaki.)

There is some difference in case of limited partnerships, since its members have different positions in the
company. Thus general partners (GPs) are liable for company's obligations same as members of general
partnership, i.e. with unlimited solidarity. Limited partners are liable only up to the value of their stake.
(Postoje neka razlike u sluaju ogranienog partnerstva, budui da lanovi kompanije imaju razliite pozicije u
kompaniji. Ovako "openito" partneri (GPs) su odgovorni za obveze kompanije isto kao i lanovi opeg partnerstvo,
tj. s neogranienom solidarnou. "Ogranieni (limited)" partneri su odgovorni samo do vrijednosti njihovih udjela.)

This strict regime of liability has its rationale in the fact that personal elements prevail in this type of
company, which is the main reason for such a form of liability.(Ovaj strogi reim odgovornosti ima svoje
razloge u injenici da lini elementi prevladavaju u ovoj vrsti kompanije, koji je glavni razlog za ovakav oblik
odgovornosti.)

Why are limited partners exempt from this liability? The reason lies in the fact that they are secret
partners, and are not registered in the court register not appear in public or in business relations. (Zato
su ogranieni partneri izuzeti od ove odgovornosti? Razlog lei u injenici da su oni tajni partneri, a nisu upisani u
sudski registar, ne pojavljuju se u javnosti ili u poslovnim odnosima.)

Regardless of the legal possibility for them to be entrusted with the representation function, upon the
approval by all general partners, they still do not exist for the legislator in the formal sense. (Bez obzira na
zakonsku mogunost za njih da povjere funkciju zastupanja nekom drugom, nakon odobrenja od strane svih
generalnih partnera, oni jo uvijek ne postoje u zakonodavnom i formalnom smislu.)

The basic form of liability is liability for one's own obligations. This is an imperative own liability, which is
also called the full liability. In practice, the company's name frequently includes the designation 'full-
liability company'. (Osnovni oblik odgovornosti je odgovornost za vlastite obveze. To je imperativ vlastite
odgovornosti, koja se takoer zove "puna odgovornost". U praksi, naziv kompanije esto ukljuuje oznaku puna
odgovornost.)

Even without this designation, this goes without saying, since this is an imperative norm. This kind of
liability covers the entire property except for the assets which are exempt from execution pursuant to the
rules of executory proceedings. (ak i bez te oznake, to ide bez izgovaranja, jer je to imperativ norma. Ova vrsta
odgovornosti pokriva cjelokupnu imovinu, osim imovine koja su izuzeta od izvrenja u skladu s pravilima postupka
izuzimanja.)

Company's independent liability for its own obligations can be "reinforced" so that it is also liable for other
legal subjects' obligations. What would the concept of other legal subjects include? In the first place, these
would be the so-called affiliated persons, or other companies that have the capacity of subsidiary.
(Neovisna odgovornost drutva za svoje vlastite obveze moe biti "ojaana, tako da je i odgovorna za druge obaveze
pravnih subjekata. to bi koncept drugih pravnih subjekata ukljuili? U prvom redu, ove tzv povezane osobe, ili druge
kompanije koje imaju kapacitet podrunice.)

It is the liability of the so-called parent company, or the company with majority shares in a joint-stock
company, or the majority share/contribution/stake in a limited-liability company. In case of carrying out
the bankruptcy proceedings over a subsidiary, if creditors are not settled, the parent company is liable for
the remaining obligations. (To je odgovornost nadreene kompanije, odnosno kompanije sa veinskih udjelom
(dionica) u dionikom drutvu, odnosno veinskog udjela/doprinosa u drutvu ograniene odgovornosti. U sluaju
provedbe steajnog postupka preko podrunice, ako kreditori ne rijee, nadreena kompanija je odgovorna za preostale
obveze.)

23 | P a g e
There is no feedback in case of bankruptcy proceedings over the parent company. How is the parent
company liable? It is liable with unlimited solidarity, i.e. with the entire company assets. The prerequisite
for such a strict form of liability is the case when the bankruptcy resulted from carrying out the obliging
written instructions by the parent company. (Nema povratka u sluaju steajnog postupka kod nadreene
kompanije. Kako je nadreena tvrtka odgovorna? Odgovorna je sa neogranienom solidarnou, tj. sa cijelom
imovinom kompanije. Preduvjet za takav strogi oblik odgovornosti je sluaj kada je steaj posljedica obavljanja
pismenih uputa od nadreene kompanije.)

Besides this kind of liability, the parent company is liable, in the bankruptcy proceedings, with unlimited
solidarity for other obligations taken in legal and business transactions as well. (Osim ove vrste odgovornosti,
matina kompanija je odgovorna, u steajnom postupku, s neogranienom solidarnosti za ostale obveze poduzete,
pravne i poslovne transakcijetakoer.)

Secondary liability also exists in case of introducing status changes. This liability, regardless of the kind of
status change, arises by virtue of legal succession or universal succession. This form of liability includes
only the obligations incurred up to the moment of status change. (Sekundarna odgovornost postoji u sluaju
uvoenja promjene statusa. Ova odgovornost, bez obzira na vrstu statusne promjene, nastaje na temelju pravne
sukcesije ili univerzalne sukcesije. Ovaj oblik odgovornosti ukljuuje samo obveze nastale do trenutka statusne
promjene.)

This liability is solidarity and unlimited, and represents the/form of liability defined by law, so that a
contractual provision that would exclude it would be absolutely void. (Ova odgovornost je solidarna i
neograniena, te predstavlja oblike odgovornosti definirane zakonom, tako da ugovorna odredba koja bi to iskljuila,
bila bi apsolutno nevaea.)

Secondary liability can also arise from the change in company form. It is a distinctive transformation of a
company from one to another organizational form. The most frequent form of this transformation is
encountered in transformation of joint-stock companies into limited-liability ones. (Sekundarna odgovornost
moe nastati iz promjena oblika kompanije. To je karakteristina transformacija poduzea iz jednog u drugi
organizacijski oblik. Najei oblik ove transformacije je transformacija dionikih drutava ograniene odgovornosti.)

A separate form of liability is the company's liability for damage caused by its employees and organs of the
company itself. Organs, its members and employees themselves work on behalf and on the account of the
company itself. (Poseban oblik odgovornosti je odgovornost za tetu uzrokovanu kompaniji od strane svojih
zaposlenika i organa same kompanije. Organi, njegovi lanovi i sami zaposlenici rade u ime i na raun same
kompanije.)

The company is always liable for damages incurred to third parties based on their unlawful decisions of
company bodies. The company is always liable for damages incurred to third parties based on their
employees' unprofessional or unlawful work. (Kompanija je uvijek odgovorna za tete nastale treim osobama na
temelju njihovih nezakonitih odluka tijela kompanije. Kompanija je uvijek odgovorna za tete nastale treim osobama
na temelju njenih "nestrunih" zaposlenika ili nezakonitog rada.)

Founders are liable for the company obligations in the already described way. Liability of corporation
founders is different from that of partnership founders. In case of corporations' liability, regardless of the
fact that founders are liable only up to the value of their stakes, they also bear the entire risk in that the
overall company assets will be the subject of general execution. (Osnivai su odgovorni za obveze kompanije na
ve opisani nain. Odgovornost osnivaa "korporacije" je razliit od osnivaa "partnerstva". U sluaju odgovornosti
korporacije, bez obzira na injenicu da su osnivai odgovorni samo do vrijednosti njihovih uloga, one takoer nose
cijeli rizik na ukupnu imovinu kompanije koja e bit predmetom opeg izvrenja(izuzimanje steaj npr i si.)

24 [ Pa g e
Piercing the corporate veil
Piercing, or lifting the corporate veil, as a separate legal institution has found its place in all the comparative
legal systems. (Piercing ili podizanje korporativnog veo, kao zasebna pravna institucija je naao svoje mjesto u svim
komparativnim pravnim sistemima.)

This legal institution has found its place in all the legal regimes that regulate the concept of companies in the
traditional way. Owing to its postulates, the need to distinguish corporate from personal property of natural
persons as company founders is emphasized. Its postulates are also directed to leveling the difference that
arises in case of liability for fulfilling corporate obligation. (Ova pravna institucija je nala svoje mjesto u svim
pravnim reimima koji reguliraju koncepte kompanija na tradicionalan nain. Zahvaljujui postulatu - naglasio je
potrebu razlikovanja korporativne od line imovine fizikih osoba kao osnivaa kompanije. Njegovi postulati su takoer
usmjereni na izravnavanje razlika koje nastaju u sluaju odgovornosti za ispunjenje obveza poduzea.)

Liability is one of basic features of companies and, when deciding for the company type, business people
mostly choose corporations. The motive can be found in the fact that the liability regime is far more
favorable. They are liable only up to the value of their stakes, i.e. shares. Assets of this type of companies
have to be considered as separate from the founders' personal property. (Odgovornost je jedna od osnovnih
znaajki poduzea i, kada se odluuje za vrstu poduzea, poslovni ljudi se uglavnom odluuju za korporacije. Motiv se
moe nai u injenici da je reim odgovornosti daleko povoljniji. Oni su odgovorni samo do vrijednosti njihovih
udjela, odnosno dionica. Imovina ove vrste poduzea mora biti uzeta u obzir kao odvojena od line imovine osnivaa.)

However, when the company is used for achieving unlawful goals, the legal institution of piercing the
corporate veil is activated. In this case, advantages of corporation owners cease and the terrain of
unlimited solidary liability is entered. They are liable same as partnership owners. (Meutim, kada se
koristi kompanija za postizanje nezakonitih ciljeva, pravna institucija "podizanja korporativnog Veo-a" je
aktivirana. U ovom sluaju, prednosti korporacija i vlasnika prestaju, te ulazi na teren drutva neograniene
solidarne odgovornosti. Oni su odgovorni isto kao i vlasnici partnerstva.)

This issue is generally resolved in two ways. The first case implies use of general clause method, or the
numerus clausus method or enumeration method. Some countries do not deal with this legal institution at
all but rather leave its resolution to judicial practice. The company, as a subject of law, is separated from
legal subjectivity of its members. (Taj se problem obino rjeava na dva naina. Prvi sluaj podrazumijeva
koritenje metoda ope klauzule, odnosno ukupan blokovi metodom ili metodom popisivanja. Neke zemlje se ne bave
ovom pravnom institucijom nego ostave rjeenje za sudske prakse. Kompanija, kao subjekt prava, je odvojena od
pravnih subjektiviteta svojih lanova.)

A shareholder in joint-stock company, owner of share in a limited-liability company, and limited partner
are not liable except when:
they use the company to achieve their personal goal which is incompatible with the goals of other
members and company as a whole;
manage company assets as their own property;
use the company for cheating or harming their creditors;
affect the decrease in company's assets in their own favour, or third parties' favour, or make the
company take obligations although they know or must have known that the company is not or will
not be capable of fulfilling them.
Ban on competing with a company - competition clause
The very ban on competition implies that natural persons with a given status in a company cannot
perform given activities that would be incompatible with the existence of such a position.
(Zabrana na konkurenciju podrazumijeva da fizika osoba s obzirom na status u kompaniji ne moe obavljati
zadane djelatnost takvog poloaja.)

25 | P a g e
Law has defined the circle of people who, due to their position, are subject to the rules of
legal institution of competition law.
i
ZOPD provides that these are the following persons:
member of an unlimited partnership,
general partner in limited partnership,
a stakeholder in a limited-liability company,
a member of board in a limited-liability company,
a member of supervisory board of a joint-stock company,
a member of board in a joint-stock company procurators.

These persons are subject to the ban that they cannot participate in an activity which is, or
could be in a competitive relation to the activity of the company where they perform one of the
entrusted tasks. (Ove osobe su predmet zabrane da ne mogu sudjelovati u djelatnosti koja je, ili bi
mogla biti u konkurentnom odnosu sa djelatnou kompanije gdje izvode jedan od povjerenih poslova.)

ZOPD starts from the fact that the ban on competition exists in two situations, as follows: the
activity is already competitive or the activity may be competitive. (ZOPD polazi od injenice da
zabrana konkurencije postoji u dvije situacije, kao to: djelatnost je ve konkurentna ili aktivnosti moe
biti konkurentna.)

The duration of ban pertains to the entire time period of performing some of the enumerated
functions, or the existence of some of the capacities, although the ban can also be prescribed for
a longer duration. In order to allow the referral to this longer duration, it should be defined by
the company's articles of association or statute. (Trajanje zabrana odnosi se na cijelo razdoblje za
obavljanje neke od nabrojenih funkcija, odnosno postojanje nekih od kapaciteta, iako je zabrana takoer
moe biti propisana za due trajanje. Kako bi se dopustili upuivanje na ovo due trajanje, to treba biti
definirano od strane Kompanije ili statuta)

This duration can be no longer than two years after the cessation of a given capacity. This norm
is of imperative nature, so that the duration can be determined for a shorter, but not a longer
time period. Defining a period longer than two years would have no legal effect. (To trajanje ne
moe biti due od dvije godine nakon prestanka datog kapaciteta. Ova norma je imperativne prirode, tako
da se trajanje moe utvrditi za krae, ali ne dulje vremensko razdoblje. Definiranje razdoblje due od
dvije godine ne bi imala pravni uinak.)

26 I P a g e
Company Status Change
Status changes are the manifestations of various transformations in the course of a company's operations.
Company can merge:
by formation of a new company
by absorption
by divide

Reasons for changing status can include the need to do business based on different principles. By this reason
joint-stock companies (d.d.) are transformed into limited-liability companies (d.o.o.).

Status changes are result by decisions of company owners. Status change always leads to the cessation one of
the companies. Companys "exit" is based on: free will of owner or by force of law. By the Law of
Companies status changes are mergers by forming a new company, by absorption and divisions.

Merger by formation of a new company (spajanje formiranjem novog poduzea)

Includes the association of two or more companies of the same or different organization forms into a
single new company without conducting the liquidation procedure. Decision on this status change is
made at shareholders general meeting (corporations), or by all company members (partnerships).
Decision is made by all companies that "merge", otherwise not possible. Every form of status change
must be register with the court register of companies.
With change of company's form, reorganization plan has to be made.

Reorganization plan is draw by management and supervisory board, or by other organ in company
defined by Company's memorandum of association or statue. The legislator also prescribes the
mandatory elements of reorganization plan.
The reorganization plan includes:
Data on participating companies (forms, names and registered offices of participating
companies and transferor companies)
Ownership rights of shareholders or transfer companies in new company
Description, valuation and distribution of companies assets and liabilities that are transferred
to the new company, with auditor's report
Data from which the shareholders of the transferee company will be entitled to participate in
profit.
Data from which the transactions of transferor companies will be treated as being those of the
transferee company for accounting purposes

In case of division, reorganization plan includes too:

The share exchange ratio
The terms relating to the allotment of share or interests, and the amount of cash payments
Any right in transferee companies to be allotted to the holders of share or other securities in the
transferor company to which any special rights attach
Description and allocation of assets and liabilities that are being transferred to each transferee
company
Reorganization plan must include a written Auditiors report that includes:
indication of methods used in determining the share exchange ratio
auditor's opinion (on methods used)
description of valuation problems forced by auditor

27 I P a g e
Merger by absorption
Company can "merge" assets and liabilities, without regular liquidation procedure to another
i
company. It is possible in cases when:
only between corporations, or between partnerships
no limitations between companies of same type, exceptionally joint-stock company
can merger only with another company which will fit criteria for open joint-stock
company
company that emerges become "owner" of obligations and rights, and its liable with all
assets
if is a market position the same for both companies - establishing new company
if is a one more dominant from another - absorption to the dominant

Division
Is form of status change where one company is divided into two or more companies by division.
Division status change can be carried by 2 ways:
by absorption (company is separated; split assets on two or more companies)
by establishing new company (company assets is devise between two new companies)

New companies are liable for the obligations of divided company with entire assets of new
company

Change in company form

implies a change the "form" of existing companies
one is transferred to another without changing ownership structure
name, assets and other identifications of company stay a same

Legal consequence of status change:

companies participating in a status change cease to exist
companies participating in a status change are deleted from the court register of
companies
companies participating in a status change do not cease to exist pursuant to
bankruptcy procedure or regular liquidation procedure
the newly formed company - retake all previous obligations of companies
owners of companies that have ceased to exist - can be liable only if legal institution of
piercing the corporate veil is activated.

Economic consequence of status change:

newly formed company is liable for all obligations transferred by former
companies newly formed company become holder of all rights, assets...
status cannot be occur unless tax obligations and other financial obligations are realized

28 I P a g e
Systems of establishing companies
We have more systems of establishing companies, there are:
normative system
system of law
system of concessions
system of applications
licensing system

Complexity company's form implement a combination of two or more systems. Procedure of establishing
companies is defined by legal instruments. Basic norms are contained in ZOPD (Zakon o privrednim
drutvima). There are also separate legal instruments regulating this area, which prescribe the pre-requisites
companies have to meet in order to be registered with the competent registration court. Special laws and by
laws have character and legal nature of lex specialis.

Act on Registration of Business Subjects in Federation BiH is legal framework for process of registration
business entities into court register. (Zakon o registraciji poslovnih subjekata u Federaciji BiH je pravni okvir za
proces registracije poslovnih subjekata u sudski registar.)
Same provision is found in the Framework Act on the Registration of Business Subjects in BiH and RS too.
(Ista odredba se nalazi u okviru Zakona o registraciji poslovnih subjekata u BiH i RS takoer)

Normative system
It is considered dominant both in our legal system and comparatively. The essence of this system is that a
law prescribes requirements for company establishment. All natural and legal persons have right to register
a company. Establishment of a company is completed with the act of its registration. Registration court is
authorized to question meeting the requirements determined by law. All founders are equal (including
foreign legal and natural persons). Any limitations are determined by a separate law.
Normative system prevails because it is applicable to all forms of company organization including the
special ones, when additional establishment requirements are prescribed by lex specialis. Other regimes of
company establishment can thus be considered as accompanying this one.

System of law
Company is established by means of a special law or another administrative document.
It has been preserved to this day in certain sectors significant for conducting activities of general interest
which, in turn, is an expression of the need to satisfy citizens' requests. Another term for these activities are
utility services. (Sauvan je do danas u pojedinim sektorima, znaajnih po obavljanju djelatnosti od "opeg dobra"
koji se, - izraz potrebe da zadovolje zahtjevi graana. Drugi izraz za ove aktivnosti su komunalne usluge.)

These companies are formed in accordance with special laws and they are registered as one of the two
forms of corporations. These forms of organization also have to undergo the registration regime with the
authorized registration court.

The system of concessions

It has been preserved to this day regardless of its apparently archaic elements. The existence of unavoidable
legal regime of goods in general use makes this system applicable for establishing certain companies that
operate based on a granted concession, or based on granting a special form of approval. (Postojanje
neizbjenog pravnog sistema "opeg dobra" ini ovaj system prihvatljivijim za osnivanje kompanije koja djeluje na
osnovu neke koncesije ili specijalnog odobrenja)
This system is prevailing for goods in general or in common use as:
natural resources (oil, eas. etc), water, roads, harbors, airports etc.
granting concession for doing certain activities of general interest,
this is a combination of normative regime and concession regime of company establishment.
registration of company also with the authorized registration court.

29 [ P a g e
Licensing system
i
Is presented with special forms of organization, when a special law of the lex specialis nature,
provides the basis for establishing these companies.
Licenses are granted by state regulatory organs. In case of commercial banks, this is the
Banking Agency, and in case of insurance companies it is Supervisory Agency. For establishing
joint-stock companies the license by the Securities Commission is necessary.
These regimes can also be found in comparative legal systems in a similar form. The procedure
of its establishment is also completed with the registration with the authorized registration
court.

Regime of application
Is applied in cases when given company requires an application. The application is submitted to
the authorized state organ, which is also determined by a separate Law of policies of Direct
Foreign Investments in BiH.

This regime is necessary and is usually present in recording foreign investments. In BiH legal
regime - the obligatory recording of foreign investments is done based on a special law by
Directives for FDI registration the constitutive section of which is the form for registration of
foreign investment. (U pravnom sistemu BiH obavezan upis stranih ulaganja se vri na temelju
posebnog pravilnika direktiva za registraciju izravnih stranih ulaganja konstitutivni dio je obrazac za
registraciju stranog ulaganja.)

The reasons include both the need to keep track of economic happenings in this area, i.e.
collecting statistics and, above all, the fact that each state wants to use the available data on
foreign direct investment to issue special incentives and benefits, as well as harmonize the
entire FDI regime with numerous international conventions and the assumed obligations
towards the international community. (Razlozi ukljuuju i potrebu za praenje ekonomskih
dogaanja u ovom podruju, tj. prikupljanja statistike i, iznad svega, injenica da svaka drava eli
koristiti dostupne podatke o izravnim stranim ulaganjima za izdavanje posebnih poticaja i pogodnosti,
kao i usklaivanje cijelog FDI reima s brojnim meunarodnim konvencijama i preuzetim obvezama
prema meunarodnoj zajednici.)
This system is also accompanied by the mandatory company registration with the competent
registration court. Competent organ for applications is Ministry of Foreign trade of BiH.

30 [ Pa g e
Company identifiers
Company identifiers:
Company name
Business activity
Registered office
Registration number
Tax number, etc.
Companies have their identifiers defined by law. The essential reason for the existence of company
identifiers is their distinction in legal and business transactions. Registered companies with given identifiers
also enjoy certain legal protection.

Company name is the name under which a trading company operates and by which it is identified in legal
and business transactions, (mandatory company identifier required by law). It is one of the basic company
attributes required for the registration in the company register.
Act on Registration of Business Subjects in Federation BiH provides the general information entered into the
main register by the competent registration court include:
company name and registered office
full names and residences of all founders (owners) of the registry subject.

A company is separated from its founders in terms of assets; consequently a distinction must be made both
in terms of legal identifiers and in terms of the company name itself (Imovina odvojena od osnivaa, stoga razlika
mora biti napravljena kako u pogledu zakonskih identifikatora samog imena kompanije.)

Naming corporations requires the mandatory designation of the company form in the full company
name: L.L.C. (d.o.o.) - limited-liability company; JSC (d.d.) - joint-stock company.

Including personal elements in the corporations' names is frequent in practice. This statement is particularly
true of single-member companies (company names of which frequently include surnames, first names and
various acronyms). Personal elements are mandatory for the partnership names too.

Company activity is the economic activity conducted by a company. Activity is frequently called the
business field. Activity itself implies a set of a few activities registered by a company in the court register. In
practice, companies register a greater number of activities, typically those they assume could be their
business field. Companies must register their activity, i.e. have it filed into the court register.
The very act of registration in the court register is not the sufficient pre-requisite for starting the registered
business activity.
Special requirements in the fields can be, for example, Pharmacy industry, Food industry, Auditing services,
Securities, Gambling, Forwarding companies etc.

Registered office
Company registered office is its mandatory element, i.e. it represents a constituent part of the company
name. ZOPD defines registered office as a site which is registered as a registered office in the register of
companies (also determined by the memorandum of association or statute). (ZOPD definira sjedite kao mjesto
koje je registrirano kao "registrirani ured" u registru poduzea. Takoer odreen memorandumom o udruivanju ili
statutom kompanije).

Registered office must be designated in both documents. ZOPD prescribes that offices are registered only in
the court register in the registration court where the company is registered.

31 | P a g e
Branches should be subject to the same regulation, i.e. that the office name must include its seat,
i
with the mandatory citation of the registered office of the company itself.
This is necessary for: (da se koristi samo jedna adresa za sve urede, produnice...)

determining liability (utvrivanja odgovornosti)

determining the authorized court in disputes (odreivanje nadlenog suda u
sporovima)
executing decisions (izvrenja odluke)
in order to identify and protect third parties' interests (kako bi se identificirali i
zatitili interesi treih osoba)
The registered office is typically defined as a site which is also the site where business is
managed from.

A company registered office serves to determine:

competence of the court with respect to all subsequent changes pertaining to the
registration of mandatory elements in company register (nadlenosti suda s obzirom na sve
naknadne promjene koje se odnose na upis obveznih elemenata u registar poduzea)
competence of the municipal court which protects the company name by duty, and
during the very act of company registration (nadlenost opinskog suda koji titi naziv
kompanije po dunosti, a za vrijeme samog ina registracije poduzea)
company seat is also relevant to determine local jurisdiction of the actually competent
court in resolving mutual disputes between the company founders (sjedite kompanije je
takoer relevantno za odreivanje lokalne nadlenost stvarnog nadlenog suda u rjeavanju
meusobne sporove izmeu osnivaa kompanije)
further, in accordance with legal proceedings, the court competence in business
disputes is determine based on the registered office of the company (dalje, u skladu sa
sudskim postupkom, nadlenost suda u poslovnim sporovima koji se odreuju na temelju
sjedite kompanije)
registered office of a company also serves to determine the competent court for
executing deeds on monetary resources and movable objects (sjedite kompanije takoer
slui za odreivanje nadlenog suda za izvrenja djela na novana sredstva i pokretne objekte)
conducting legal and administrative disputes is also guided by the company's
registered office (obavljanje pravnih i upravnih sporova je takoer voeno u sjeditu
kompanije)
in executing bankruptcy proceedings, the exclusive competence of municipal court is
decided upon depending on the registered office of bankruptcy debtor (u provedbi
steajnog postupka, iskljuiva nadlenost opinskog suda ovisno gdje je sjedite steajnih
dunika)

Other company identifiers

Besides the listed identifiers, which determine the company type and identification elements,
companies have other identifiers that presently appear as mandatory. (Osim navedenih
identifikatora, koji odreuju tip kompanije i identifikacione elemente, kompanije imaju druge
identifikatore koji se danas pojavljuju kao obavezni.)
The goal of establishing these identifiers is achieving as full identification of a company as
possible compared to others. (Cilj uspostavljanja ovih identifikatora je to je mogue vea
identifikacija poduzea u usporedbi s drugima)
These are identifiers pertaining to the legal obligation of opening and registering:
tax number
customs number
registration
identification number

32 [ Pa g e
Entering business entities into court
Subjects of entry into court register include all business entities that are obligated to do so by laws of
Entities and Brko District. (Subjekti upisa u sudski registar su svi poslovni subjekti koji su obvezni to uiniti
(upisati se u registar) po zakonima entiteta i Brko Distrikta.)

According to ZORPS, following business entities are entered into register:

all forms of business societies and their associations
all public enterprises
all institutions with public authority
establishments.
public corporations
business societies
co-operatives
co-operative alliances and other entities as defined by a separate law in Federation B&H

*ZORPS - Zakonom o registraciji poslovnih subjekata

Registration court can require only the information determined by law. No other proofs beyond this
circle can be required.

The general data include:

firm and seat, i.e. full name and seat of all the founders/owners of the subject of entry object of
entry
firm and seat of the subject of entry
abbreviated name of firm-subiect of entry
taxation and identification number
custom number
form of the subject of entry
full name and position of the authorized representative of subject of entry
extent of authorities of the representative of the subject of entry
amount of agreed [documented] equity
amount of the capital paid in cash
amount of capital in assets and rights
percentage of participation of each individual founder in the capital of sublect of entry (in
cash, assets and rights)

Special data include:

branches of business units of subject of entry
ties of subsidiary society
merger between two or more subjects of entry
amalgamation to one or more subjects of entry to another subject of entry
divisions of subjects of entry to two or more subjects of entry
changes of the form of subject of entry- transformation
and wavs of cessation of subject of entry
Registration of the branch, as part of business society, requires registration into society register of
following obligatory special data. (Registracija "grane" (produnice), kao dio poslovanja drutva, zahtijeva upis
u registar drutva sljedeim posebnim obveznim podacima)
firm and seat of branch or business unit of subject of entry
business activity of the branch or business unit of subject of entry
name, number and date of the document on the establishment of branch or business unit of
subject of entry
the full name of the person authorized for representing the branch or business unit of subject
of entry
Special data are required for subsidiary societies as well:
status changes of mergers
amalgamations and divisions of subject of entry and the registration of cessation-removal of
subject of entry
33 | P a g e
These are the data that will allow easy identification and linking subjects being registered and subjects
F
being removed from the society register. (To su podaci koji e omoguiti jednostavnu identifikaciju i
povezivanje registriranih subjekata kao i uklonjenih subjekata iz drutvenog registra.)

These data are necessary since it should be known who is the new legal successor of the obligations and
rights of business society ceasing to exist. (Ovi podaci su potrebni jer to bi trebalo biti poznato ko je novi
pravni sljedbenik obveze i prava poslovnog drutva koje prestaje postojati.)

As a separate obligation in registering necessary data, ZOPD provides for the registration of
identification information on members, deposits and liability for obligations in society with stock and
shares in the society.
(Kao posebna obveza u registriranju potrebnih podataka, ZOPD osigurava registraciju identifikacijskih
informacija o lanovima, depozitu i odgovornosti za obveze u drutvu s dionicama i udjele u drutvu.)

These include following:

full name and address of residence, or firm and address of seat, of members of unlimited
liability society, joint liability, limited partnership and limited liability society (puni naziv
i adresu stanovanja, odnosno firma i adresa sjedita, lanova drutva neograniene odgovornosti,
zajednike odgovornosti, komanditnog drutva i drutva sa ogranienom odgovornou.)

amount of agreed (documented) and deposited stakes of members of limited partnership

and limited liability company (iznos ugovorene (dokumentirano) i odlae udjele lanova
komanditnog drutva i drutva s ogranienom odgovornou;)

total number of shares and amounts of respective shares, expressed in percentage of

participation in equity for each member of the limited liability company (ukupan broj
dionica i koliine pojedinih dionica, izraen u postotku uea u kapitalu za svakog lana drutva
ograniene odgovornosti)

symbol for class, number and nominal value of stock company shares, by classes
(simbol za klasu, broj i nominalnu vrijednost dionica dionikog drutva, po klasama.)
What is considered substantial and what should be integral part of the Law, the part pertaining to the
society register, is the provision regulating when an application for registering the establishment of
business societies will be rejected. (to se smatra znaajnim, a to bi trebao biti sastavni dio zakona, dio koji
se odnosi na registar drutva, je odredba koja regulira kada e zahtjev za upis osnivanja poslovnih drutava bit
odbijen). These are following cases:

invalidity of founding document (nevaljanost dokumenat o osnivanju)

when before applying for registration of the establishment of society in court register deposits in
the amount determined in founding document have not been paid, in accordance with law
(dokument o osnivanju nisu plaeni, u skladu sa zakonom)

when the activity of goal of operations is against the law (kada je cilj djelatnosti operacija protiv
zakona)

if the society founders cannot found a society according to law (kada osnivai ne mogu osnovati
drutvo u skladu sa zakonom)

if the founder is majority owner is a society that has outstanding obligations to creditors, or
outstanding taxes (ako je osniva veinski vlasnik u drutvu koje ima neizmirene obveza prema
kreditorima, ili neizmirene poreze

if the founder or one of founders is a member of an existing unlimited solidarity liability or

alimited partnership (ako je osniva ili jedan od osnivaa lan postojeeg drutva neograniene solidarne
odgovornosti ili komanditnog drutva) 34 1 P a g e
Registration procedure is conducted by municipal courts as actually competent courts (registracijski postupak
provode opinski sudovi kao "stvarni" nadleni sudovi.) The decision is made by individual judge (odluku donosi
sudac pojedinac). Local competency is determined depending on the proposed seat of business society (lokalne
nadlenost se odreuju ovisno o predloenenom sjeditu poslovanja drutva.)

Application for registration can also be submitted online, if it is possible to submit and check the electronic
signature. (Zahtjev za registraciju moe se podnijeti online, ako je mogue dostaviti i provjeriti elektronski potpis)

This is the qualified electronic signature or the so-called secure electronic signature, as named by the
legislator.(To je kvalificirani elektronski potpis ili tzv siguran elektronski potpis, kao i ime zakonodavca)

Implementation of these provisions is still to be implemented until the establishment of accredited

institutions for issuing secure electronic signatures, and courts become capable of use information
technology to process electronic applications. (Implementacija ovih odredbi e se i dalje provoditi do osnivanja
akreditiranih institucija za izdavanje sigurnog elektronskog potpisa, a sudovi postanu sposobni koristiti informacione
tehnologije za obradu elektronske aplikacije)

Applications
Due to frequent abuses in the procedure of business subject registration, particularly with the so-called
phantom or non-existent firms, we must welcome the introduction of legal requirement for registration
court to check the identity of applicant or founder. (Zbog estih zloupotreba u postupku poslovnog subjekta upisa,
posebice tzv fantom ili nepostojee tvrtke, moramo "pozdraviti" uvoenje zakonskih uvjeta za upis u registraciski
sudski, provjeriti identitet podnositelja zahtjeva ili osnivaa)

Registration court is obligated to accept the application, but not to process it before conducting the
described check. (Registracijski sud je duan da prihvati zahtjev, ali da ne vodi postupak prije provjere)

Besides the check of applicant's identity, court checks the exclusivity of firm-subject of entry and payment of
stamp duty. (Uz provjeru identiteta podnositelja zahtjeva, sud provjerava iskljuivost firme - subjekta upisa i uplate
takse.)

In further registration procedure, registration court examines the existence of formal and material
prerequisites for registration. (Sud ispituje postojanje formalnih i materijalnih pretpostavki za registraciju)

Formal prerequisites are following:

That the application was submitted by authorized person (da je zahtjev podnesen od strane ovlatenih
osoba)
That the application was submitted on the prescribed form and signed bv the applicant (da je zahtjev
bio podnesen na propisanom obrascu i potpisana od strane podnositelja zahtjeva)
That all the required documents were enclosed with the application (da su svi potrebni dokumenti
priloeni sa aplikacijom)
That the accepter documents have proper content and were issued through the appropriate
procedure. (Da svi prihvaeni dokumenti imaju odgovarajui sadraj i das u izdani putem odgovarajueg
postupka)

Registration court issues decisions in the form of conclusions and decisions. (Registracioni sud donosi odluke u
obliku zakljuaka i odluka)

The conclusions govern the issues of procedural nature, while the decision decides on the validity, i.e.
acceptance of the application and its registration or rejection. (Zakljuci reguliraju pitanja proceduralne
prirode, a odluka odluuje o valjanosti, odnosno o prihvatu prijave i upisa ili odbijanju)

Naturally, the decision also decides on all the later changes of data related to the status of the already
entered, i.e. registered business society. (Naravno, odluka takoer odluuje na sve kasnije izmjene podataka
vezanih za status ve prijavljenih, odnosno registrirani poslovnih drutava)

35 | P a g e
With respect to legal remedies, interested parties can file an appeal to the decision on registration
F
within eight days starting from the day of receiving the decision. (S obzirom na pravna sredstva,
zainteresovani mogu uloiti albu na odluku o registraciji u roku od osam dana od dana prijema rjeenja)

Interested parties include subjects of entry themselves, as well as any legal or natural person having
some legal interest. (Zainteresirane strane ukljuuju subjekate upisa, kao i svaku pravnu ili fiziku osobu koja
ima neki pravni interes)

Upon the filed appeal, the competent registration court can agree with the appeal if they establish that
it is grounded, and resolve the case in another way. (Po podnoenju albe, nadleni sudu registracije moe se
sloiti s albom ako utvrde da ona ima temelj, i rijei sluaj na drugi nain)

Registration court is obligated to deliver all the decisions on registration, changes of data in register,
and removal from the society register.

Indirect Taxation Administration

Municipality and Canton according to the seat of subject of entry
Bureau of Statistics
Chamber of Commerce

Pension and Disability Insurance Agency according to the seat of subject of entry (Penziono i
invalidsko osiguranje agencije prema sjeditu upisa subjekta)

Relevant Customs Administration if the subject of entry registered foreign trade operations
(Relevantna carinska uprava, ako je subjekt upisa registriran za vanjskotrgovinsko poslovanje)

Deadline for issuing decision on business entity registration is five days starting from the day of
submitting proper and documented application (Rok za izdavanje rjeenja o registraciji poslovnog
subjekta je pet dana, poevi od dana podnoenja pravilno dokumentirane aplikacije)

If there are certain deficiencies, registration court uses a conclusion to order the subject of entry to
remove them, and shall dismiss the registration if the latter does not comply. (Ako postoje odreene
manjkavosti, registracijski sud koristi zakljuak da naredi subjektu upisa njihovo uklanjanje, te e se odbaciti
prijava ako se to ne ispotuje.)

The term share (stock):

it is part of a company's equity
a set of rights and obligations related to the membership in a company
a security, i.e. electronic record that incorporates defined management and property rights

Share is a long-term investment instrument the economic function of which is capital accumulation.
(Dionica je instrument dugorone investicije ekonomske funkcije koja je akumulacija kapitala.) Establish a
membership (shareholding) relation between a company and a permanent

36 1 P a g e