Basic principles of foreign exchange transactions

According to the Foreign Exchange Law (FEL), payments and transfers between residents and non-residents are carried out freely, in accordance with this law. Foreign trade transactions, including re-export, are carried out without restrictions. However, Article 34 of the FEL specifies that payments in dinars are made between residents in Serbia, while payments to foreign countries are possible in foreign currency, but require appropriate documents (invoice, contract, customs documentation).

Types of re-export: Direct vs. Indirect

Direct Re-export: This involves the sale of goods abroad without crossing the Serbian border, meaning there is no realization of export according to customs regulations. This type of re-export is not subject to the obligations under Article 4 of the FEL.
Indirect Re-export: Goods are imported into Serbia and then sold to a non-resident in another country. This process involves both export and import in accordance with customs regulations, thus creating an obligation to report to the National Bank of Serbia (NBS).

Reporting obligations and debt offsetting

Reporting to NBS: For indirect re-export, if more than a year has passed since the transaction was completed, there may be an obligation to report on commercial credits and loans. This obligation does not apply to direct re-export.
Debt offsetting: Offsetting debts is only possible for indirect re-export, as direct re-export does not involve realized export or import of goods.
Transfer of claims and debts: Direct re-export does not allow the transfer of claims or debts since no foreign trade transaction has been realized. For indirect re-export, this is possible, provided that the foreign trade transaction has indeed been completed.

Conclusion

Re-export, whether direct or indirect, has different legal aspects according to foreign exchange law. Direct re-export does not involve export according to customs regulations and does not create obligations such as debt offsetting or reporting to the NBS. On the other hand, indirect re-export entails these obligations due to the actual export and import process.

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