Loss of residence rights for foreigners who deregister their sole proprietorship in Serbia

Many foreigners living in Serbia choose to register a sole proprietorship (pausal or otherwise) as a way to legally reside and work in the country. But what happens when they decide to close their business?

Here’s what the law says in 2025.

Legal basis: Residence through self-employment

According to the Law on foreigners and the Rulebook on the issuance of a unified permit (“Sl. glasnik RS”, no. 6/2024), a foreigner can obtain a residence and work permit in Serbia based on self-employment—i.e., by opening a registered sole proprietorship.

This unified permit can be issued for a period of up to three years and can be extended for another three years.

To apply for this permit, the foreigner must provide:

A document proving they have adequate qualifications to perform the activity,
A business registration certificate showing them as the owner.

What happens if the business is closed?

If the foreigner closes their sole proprietorship, the legal basis for their residence and work permit ceases to exist.

Why?

Because the permit was issued specifically for self-employment, and Article 46a, Paragraph 4 of the Law on Foreigners clearly states:

The foreigner must reside in Serbia in accordance with the purpose for which the permit was granted.

If the business no longer exists, self-employment no longer exists, and thus the permit becomes invalid.

Do they lose their right to stay in Serbia?

Yes—unless they apply for a different type of residence permit (e.g., for family reunification, education, ownership of real estate, or some other basis).

So, even if the person:

Has been living in Serbia for years,
Has legal documents and proof of residence,
Has operated the business for three years,

…they still lose their right to stay if the original basis for the permit (self-employment) is gone.

What should foreigners do before closing their business?

If you’re a foreigner planning to close your sole proprietorship in Serbia, here are your options:

Apply for another type of permit before closing the business,
Switch your business model (e.g., from pausal to a company) and update your permit accordingly,
Consult with a legal or immigration advisor before making changes to your status.

Conclusion

Residence rights in Serbia are directly linked to the legal basis on which they are granted. If that basis—like self-employment—ends, so does the right to stay. Foreigners who plan to close their businesses must act proactively and consider alternative legal grounds for continued stay.

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