With key support from the EBRD’s Legal Transition Team, Montenegro accelerated the reform of its legal framework at the end of October when it adopted new legislation covering financial leasing, factoring, purchase of claims, micro-credit and credit-guarantee issues by the state parliament. Montenegro’s legal and regulatory framework is now significantly better aligned with international best practice.
“The EBRD has a well-established track record in supporting legal reform,” said Jaap Sprey, the EBRD’s Montenegro chief. “This support comes in areas such as promoting access to finance, particularly in assisting with the development of legal and regulatory systems for alternative financial structures such as leasing and factoring. The new law introduces the regulation and legislation needed to ensure the stability of the market and legal efficiency of transactions while not putting undue regulatory burden on the industry.”
The Montenegrin Minister of Finance Darko Radunović added: “The new laws’ leasing provisions will provide for a more robust framework on leasing operations. The introduction of new legislation on factoring is expected to facilitate the development of the factoring business and guarantee stability of the market.”
Jelena Madir, the director of the EBRD’s Legal Transition Team and one of the main players in supporting the drafting of the new legislation, stressed that the law should create the environment for the development of factoring and leasing activities, which should ultimately facilitate and improve the access to finance of small and medium-sized enterprises.
Since Montenegro joined the EBRD in 2006, the bank has invested more than €500 million through more than 50 projects, its goal being to make the country’s economy more competitive, integrated and green. The bank focuses on enhancing the competitiveness of the private sector, supporting sustainable practices in the tourism and property sectors and promoting energy security and efficiency on a regional level.