On 30 November 2021, the Ministry of Economic Development of Montenegro (the „Ministry“) announced the public call for consultations of the interested public on the draft of the Law on Credit Guarantee Fund (the “Draft Law”). As declared in the public call, the Draft Law is prepared by the Ministry and it is published on the official web-site of the Ministry.

Draft Law effects

The primary aim of the Draft Law is to regulate the establishment, activities and operations of the Credit Guarantee Fund of Montenegro (the “Fund”), which shall achieve its purpose through the issuance of guarantees to credit institutions, leasing companies and microfinance institutions for settling the obligations of entrepreneurs, micro, small and medium enterprises, as well as agricultural producers from the register of agricultural holdings maintained by the Ministry of Agriculture, Forestry and Water Management.

As declared by the Draft Law, the main purpose of establishment of the Fund and its issuance of guarantees to the companies and entrepreneurs that fulfil the respective criteria is ensuring these companies and entrepreneurs to conclude loans, leasing agreements and other financial engagements with the respective financial institutions.

Specifically, the Draft Law is mainly consisted of two parts, whereas the first part of the Draft Law deals with the issues of determining the terms and conditions for issuance of guarantees to the financial institutions, as well as to defining the maximum amount of each guarantee to be issued, guaranteed event, and the process of submitting the request for guarantee payment

The second part of the Draft Law is mainly focused on the issues of regulating the incorporation of the Fund and its corporate bodies, terms and conditions for their appointment and release, as well as their competencies and cooperation of the Fund with the Central bank of Montenegro.

Conclusion

The public call for consultations lasts for 20 days as of the day of public call announcement, meaning that the interested public (e.g. financial institutions, companies, other interested persons etc.) can send its proposals and suggestions to the Ministry until 20 December 2021.

Moreover, the Ministry will organize the round table with respect to Draft Law discussion on 15 December 2021, starting at 10:00 AM, and the attendance of interested parties should be confirmed in written to the Ministry.

The information contained in this document is given for general purposes only and should not be interpreted as legal advice on any particular matter.