Rules for state aid for the construction of new hotels in spa resorts and in Belgrade published - Here's who will be entitled to subsidies

The Government of Serbia amended the existing Regulation on determining the criteria for awarding incentives in order to attract direct investment in the hotel accommodation service sector, and the amendments now provide for 20% assistance for the construction of new and expansion of existing hotels in spas and the Belgrade region.

Investments in new accommodation capacities, as previously announced, are necessary for the implementation of the international specialized exhibition EXPO Belgrade 2027.


Who will be entitled to aid?

The state will allocate money for investment projects in the sector of hotel accommodation services in spa and climate resorts, the minimum value of which is EUR 2 million and which will ensure the employment of at least 30 new employees for an indefinite period.

Also, funds can be allocated for investment projects in the Belgrade region for the construction of a hotel that will be categorized with three or more stars and have a minimum of 50 accommodation units, and whose minimum investment value is EUR 5 million.

In the Belgrade region, the state will also help hoteliers who plan to reconstruct or expand hotels that will be categorized with three or more stars and have a minimum of 50 accommodation units, and whose minimum investment value is EUR 2 million.

The hoteliers must ensure participation of at least 25% of justified costs from their own funds, or from other sources that do not rely on state aid.


Deadlines for construction and employment

Applications for state aid are possible until the end of 2024.

The deadline for the implementation of the project and the employment of new employees connected with the investment project in the spa and climate resorts is up to three years from the date of submission of the application for the allocation of funds. As stated in the regulation, the term after the conclusion of the contract on the allocation of incentive funds can be extended for a maximum of five years, if the Council for Economic Development considers that the circumstances that led to the need to extend the term are objective and that the extension of the term is justified and expedient.

For investments of special importance, the deadline for the realization of the investment project and the employment of new employees connected with that investment project is up to ten years from the date of submission of the application for the allocation of funds.

For investments in the Belgrade region, the deadline for the implementation of the investment project is two years from the date of submission of the application for the allocation of funds, and this deadline can be extended after the conclusion of the agreement on the allocation of incentive funds until December 31, 2026 at the latest.

Exceptionally, as stated in the regulation, the deadline for determining the hotel category can be extended until February 28, 2027.

The Finance Minister Sinisa Mali announced at the end of October that the state will subsidize the construction of new hotels and the reconstruction of existing ones, because Serbia lacks accommodation facilities for EXPO 2027.

The President of the Business Association of the Hotel and Hospitality Industry of Serbia (HORES), Georgi Genov, said that Belgrade needs more hotels and that the state's stimulus for the construction of new ones, due to the international exhibition EXPO 2027, is encouraging, but the decision on whether to invest will be made by investors.

The state has, until now, stimulated the construction of hotels in spas and climatic areas, namely for investment projects in the hotel accommodation services sector, the minimum value of which is 2 million EUR and which ensure the employment of at least 30 new employees.

I. Z.

Vlada Republike Srbije

Ministarstvo finansija Republike Srbije

HORES Beograd

HORES

Sinisa Mali

Georgi Genov

EXPO 2027

expo 2027

hotel construction

subsidies for hotel construction

Regulation on determining criteria for awarding incentives to attract direct investment in the hotel accommodation services sector