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Vlado Kapor, Partner, Nikčević Kapor Law Office

Foreign Investors Trust Our Lawyers

The lawyers of the Nikčević Kapor Law Office gained their first experiences in construction law while working at Energoprojekt on major projects in the country, around the region and on international markets, explains partner Vlado Kapor

We spoke with the Nikčević Kapor Law Office’s Vlado Kapor about trends in the construction sector, the specialisation and segmentation of construction law, the permit issuance process, the slow process of resolving property law matters, and the expectations and demands of foreign investors. Kapor believes that this strong investment cycle will last for many years to come.

The construction sector is always in the focus of both the business sector and the population. It seems that this has been particularly relevant in recent years, due to rising prices and demand for apartments. How do you see the construction sector evolving over the next five to ten years?

— Belgrade is already in the midst of a strong investment cycle, which has a significant impact on demand for apartments and, in turn, rising prices. This cycle is expected to last until 2027, when the EXPO event will take place, further motivating investment in real estate and infrastructure. The period after that will depend on how much investment Serbia attracts at that time and on the development of global events. At this moment, we certainly believe that energy and infrastructure projects will remain key drivers. On the other hand, the construction sector is evolving rapidly and becoming increasingly complex. Within this evolution, we observe the specialisation and segmentation of construction law in accordance with different sectors—energy, infrastructure and industry. Construction law often intersects with merger and acquisition transactions, as real estate and land are increasingly viewed through the lens of corporate acquisitions. Our initial experiences in this field were gained while working at Energoprojekt on major projects in the country, around the region and on international markets, which allowed us to develop a deeper understanding of the requirements and needs of various industries that are now becoming increasingly relevant in Serbia.

Is local law facing competition from abroad? Can the local market meet the demands of foreign investors?

— Competition from abroad is constant, especially in complex international transactions which are always accompanied by global law firms, at least when large companies are involved. However, the local legal market is keeping pace with trends and meeting market demands, especially in sectors that are directly linked to investment. This includes the construction and infrastructure sectors, energy, M&A, banking, and compliance with international regulations. Foreign investors, particularly in the banking sector, are increasingly seeking legal services that cover complex aspects like compliance with international sanctions and data security.

Construction law often intersects with merger and acquisition transactions, as real estate and land are increasingly viewed through the lens of corporate acquisitions

We are all witnessing that, under the influence of current global events, business in the banking sector has perhaps become the most complex, and compliance with the requirements of the banking system is reaching a higher level. Local lawyers strive to provide comprehensive support to foreign investors, as we have developed flexibility and an understanding of market needs through our experience with domestic and international clients. This is particularly true in the area of permitting, where local legal support is indispensable.

You mentioned permitting. Are we more efficient in issuing permits and handling administrative procedures? How do we compare to other countries in the region?

— Permitting has become a specialised service that requires both legal and technical-administrative knowledge. The permit issuance process in Serbia has improved over the past few years, but we still lag behind some countries of the region. We believe that the slow resolution of property law matters, which often delays project implementation, remains the key obstacle.

Although permits can be obtained quickly once all conditions have been met, property law issues preceding permit issuance are still resolved slowly and represent a significant challenge. We believe that improvements and modernisation in the work of the cadastre will enable these obstacles to be overcome more quickly.

What is the efficiency of the courts? Is the judicial system adapting to new trends?

— Serbia’s judicial system faces numerous challenges, especially when it comes to complex construction and commercial disputes. Modern contracts, such as FIDIC contracts, require specific knowledge and practice, and the judicial system still lacks sufficient mechanisms to resolve such disputes quickly and efficiently. With a few exceptions, in most cases courts lack the conditions for specialisation in resolving disputes arising from complex international contracts.

The introduction of specialised court divisions dedicated to construction disputes would contribute to more efficient problem-solving in this area

It should be noted that the situation is not much better in other countries of the region, or even further afield. The introduction of specialised court divisions dedicated to construction disputes would contribute to more efficient problem-solving in this area. Additionally, alternative dispute resolution, such as arbitration, is becoming increasingly prevalent, as it allows for faster and more efficient results. We strive to conduct our work in a way that provides clients with a comprehensive approach to dispute resolution, whether through court proceedings or arbitration.

Your firm has extensive experience working on major infrastructure projects, particularly in the construction sector. What specific challenges do you see when working with foreign investors on such projects, and how does your firm contribute to successfully overcoming these challenges?

— Foreign investors often face challenges in understanding local regulations and resolving property law issues. Working on significant infrastructure projects in various sectors, including energy and construction, has enabled us to provide foreign investors with comprehensive support—from resolving property law matters and obtaining permits to negotiating and drafting contracts, as well as day-to-day project management. One of our specific resources is a dedicated team of engineers and technical staff who specialise in handling the everyday challenges of project management. The combination of legal and technical knowledge allows us to identify risks in the early stages of a project, alert clients and their contractual partners to potential problems, and provide timely guidance on possible outcomes, in terms of administrative, economic and technical risks. For example, over recent years we’ve witnessed global restrictions on movement, goods and services trading, price escalations and project delays, most of which are beyond the control of the contracting parties.

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