General Information
Before setting up a business in Bosnia-Herzegovina it is highly recommended to consult the Bosnian administration and make use of the services of legal and tax consultancies well-established in this country, which is still not particularly open to foreign investment. The majority of economic activities are still regulated and subject to prior authorisation. It is therefore indispensable to seek information from the Bosnian Economic Chamber, of the Trade and Investment Promotion Agency and the Ministry of Foreign Affairs. The taxation system is highly attractive to businesses (the corporate rate is 10%). However, attention must be paid to the foreign exchange controls. Cash payment by SWIFT transfer before shipment is essential.

Means of Payment & Banking Specificities

Bank cheques or cheques issued by businesses should be avoided. They are not used in Bosnia-Herzegovina apart from by foreign banks that issue cheques in currencies payable outside of Bosnia-Herzegovina. The provision of an export credit agency backed financing or, potentially, an irrevocable and confirmed letter of credit should be considered.

Obtaining the confirmation of documentary credits is difficult in Bosnia-Herzegovina. Any such commitment will be studied on a case-by-case basis in accordance with the counterparty, the duration of the documentary credit and the willingness to deal with the country’s risk rating. The country’s risk remains high and the credit warranty costs remain costly.

Many transactions in Bosnia-Herzegovina are carried out using payment in advance. A clearing system for domestic transfers - GC Giro Clearing System - has been introduced.